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(Note) This document has been translated from the Japanese original for reference purposes only. In the event of

any discrepancy between this translated document and the Japanese original, the original shall prevail.

The Independent Auditors' Reports contained in this document have also been translated by the Company.

KPMG AZSA LLC, the Accounting Auditor, has never been involved in this translation and therefore

assumes no responsibility for this translation or for direct, indirect or any other forms of damages arising

from the translation.

Securities Code: 4902

May 26, 2014

To Our Shareholders

Shoei Yamana

Director, President and CEO

Representative Executive Officer

Konica Minolta, Inc.

2-7-2 Marunouchi, Chiyoda-ku, Tokyo

NOTICE OF CONVOCATION OF

THE 110TH ORDINARY GENERAL MEETING OF SHAREHOLDERS

KONICA MINOLTA, INC. (“the Company”) respectfully requests your attendance at the 110th

Ordinary General Meeting of Shareholders (“the Meeting”), which will be held as detailed below.

If you are unable to attend the Meeting, you may exercise your voting rights in writing or by an

electronic method (via the Internet). In this case, please examine the attached Reference Documents for

the General Meeting of Shareholders, indicate your approval or disapproval on the enclosed Voting

Form and return it so it reaches us by 5.40 p.m., Wednesday, June 18, 2014, or vote on the website for

exercising voting rights designated by the Company (http://www.evote.jp/) no later than the above-

mentioned deadline.

1. Date and Time: Thursday, June 19, 2014 at 10.00 a.m.

2. Place: Grand Arc Hanzomon, 4F “Fuji-no-ma”

3. Objectives: Matters to be Reported: 1. Reports on the Business Report, the Consolidated Financial Statements for

the 110th Fiscal Year (from April 1, 2013 to March 31, 2014); and Audit

Reports by the Accounting Auditor and the Audit Committee on the

Consolidated Financial Statements

2. Reports on the Non-consolidated Financial Statements for the 110th Fiscal

Year (from April 1, 2013 to March 31, 2014)

Matters to be Resolved:

Agenda Item: Election of Eleven (11) Directors

4. Guide to the Exercise of Voting Rights, etc. Please refer to “Guide to the Exercise of Voting Rights, etc.”

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◙ In case of any changes to the Reference Documents for the General Meeting of Shareholders, the Business

Report, Consolidated Financial Statements or Non-consolidated Financial Statements, the changes will be

posted on the Company’s website (http://konicaminolta.jp/about/investors/index.html).

◙ If you plan to attend the Meeting, please submit the enclosed Voting Form to the receptionist at the

Meeting.

◙ Shareholders who plan to attend the Meeting are asked to wear light apparel because the temperature

setting for air conditioning in the meeting room will be slightly higher than usual in order to conserve

electricity.

Guide to the Exercise of Voting Rights, etc.

1. Deadline for exercise of voting rights

As specified in the opening statement of this notice, for those unable to attend the Meeting, the deadline for

receipt of votes by mail and the deadline for the exercise of voting rights on the website for exercising voting

rights designated by the Company (http://www.evote.jp/) is 5.40 p.m., Wednesday, June 18, 2014.

2. Treatment of votes without indication of approval or disapproval

Any voting right exercised without indicating approval or disapproval for a particular proposal will be

counted as a vote for approval of the proposal.

3. Treatment of votes cast more than once by mail

If any voting right is exercised more than once by mail, the latest exercise will be upheld as a valid exercise

of the voting right.

4. Diverse exercise of voting rights

Shareholders are respectfully requested to notify the Company in writing of any diverse exercising of voting

rights and the reason therefore not later than three days before the Meeting.

Using the Internet to exercise voting rights 1. Treatment of votes cast both by mail and via the Internet

If any voting right is exercised both by mail and by the Internet, the exercise via the Internet will be upheld

as valid exercise of the voting right.

2. Treatment of votes cast more than once via the Internet

If any voting right is exercised more than once via the Internet, the latest exercise will be upheld as a valid

exercise of the voting right. If any voting right is exercised by personal computer, by smartphone and by

cellular phone, the latest exercise will be upheld as a valid exercise of the voting right.

3. Guide to using the Internet to exercise voting rights

If you decide to use the Internet to exercise your voting rights, please read the following in advance. If you

intend to attend the Meeting in person, voting in writing or using the Internet is unnecessary.

(1) Site for Exercising Voting Rights

(i) You may only exercise voting rights via the Internet by accessing the website for exercising voting

rights designated by the Company (http://www.evote.jp/) through a personal computer, smartphone

or cellular phone (i-mode, EZweb or Yahoo! Mobile)*. Please note that you will not be able to access

the above URL from 2.00 a.m. to 5.00 a.m. each day during the exercise period.

* (“i-mode” is a trademark or registered trademark of NTT DoCoMo Inc., “EZweb” is a trademark

or registered trademark of KDDI Corporation and “Yahoo!” is a trademark or registered trademark

of Yahoo! Inc. in the United State)

(ii) With respect to exercising voting rights via the Internet using a personal computer or smartphone, in

some network environments (including, but not limited to, the case in which you use firewall, etc.

antivirus programs or a Proxy Server for Internet access), you may not be able to exercise voting

rights.

(iii) With respect to the exercise of voting rights via the Internet by using a cellular phone, please use the

service by i-mode, EZweb or Yahoo! Mobile. For security purposes, the website is only compatible

with cellular phones that have functions of an encrypted communication (SSL communication) and

transmission of cellular phone information.

(iv) Although the exercise of voting rights via the Internet will be acceptable until 5.40 p.m. on

Wednesday, June 18, 2014, we recommend that you exercise your voting rights earlier. If you have any enquiries, please contact the helpdesk shown below.

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(2) Method of Exercising Voting Rights via the Internet

(i) On the website for exercising voting rights (http://www.evote.jp/), please enter your approval or

disapproval for the proposals by using your “Login ID” and “Temporary Password” described in the

Voting Form and by following the instructions on the screen.

(ii) Please note that if you wish to exercise your voting rights via the internet, you will be asked to

change your “Temporary Password” on the website for exercising voting rights in order to prevent

unauthorized access (web spoofing) or alteration of the voting by any other person than you.

(iii) The “Login ID” and the “Temporary Password” will be renewed and sent to you for each general

meeting of shareholders to be held in the future.

(3) Costs Arising from Access to the Website for Exercising Voting Rights

Any costs arising from access to the website for exercising voting rights (such as the Internet access fees)

shall be paid by you. In addition, data transmission or other fees are required when using a cellular phone

and you are responsible for these fees, too.

For enquiries with respect to exercising voting rights via the Internet

Mitsubishi UFJ Trust and Banking Corporation

Stock Transfer Agency Department (helpdesk)

Telephone: 0120-173-027

（Operating Hours: 9.00 to 21.00, toll-free number）

（Japanese language only）

To Institutional Investors As an additional method for exercising your voting rights via the Internet described above, any trust

management bank or other nominal shareholders (including standing proxies) may use the electronic voting

platform for institutional investors operated by ICJ, Inc. subject to prior request for the use of the platform.

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REFERENCE DOCUMENTS

FOR

THE GENERAL MEETING OF SHAREHOLDERS

Agenda Item Election of Eleven (11) Directors

Upon the close of this Ordinary General Meeting of Shareholders (“the Meeting”) of Konica Minolta, Inc.

(“the Company”), the terms of office of all the eleven (11) directors will expire. Accordingly, shareholders are

requested to elect eleven (11) directors based on the nominations of the Nominating Committee.

The Nominating Committee has nominated suitable candidates for achieving good corporate governance,

i.e. ensuring the transparency, soundness and efficiency of the Company’s operations, in accordance with the

director election standards determined by the Nominating Committee. In particular, outside director nominees

have been nominated, assessing their professional records and visions, ensuring they have done no material

business transaction with the Company and are strictly independent from the Company, and ensuring that they can

devote sufficient time to the Board and committee duties.

The candidates for the position of director are as follows.

Director Candidates

No. Name (Date of birth) Career history, position and responsibilities at the Company,

and important position concurrently held

1

Masatoshi Matsuzaki

(July 21, 1950)

Up for

re-election

【Number of shares of

the Company held】

65,000 shares

April 1976 Joined Konishiroku Photo Industry Co., Ltd.

November 1997 General Manager of Development Group No. 2, Color

Business Machines Development Div., Business Machines

Headquarters of Konica Corporation

May 1998 General Manager of Development Center No. 1, System

Technology Development Div., Business Machines

Headquarters of Konica Corporation

October 2003 Director of Konica Minolta Business Technologies, Inc.

April 2005 Executive Officer of the Company, and Representative

Director and President of Konica Minolta Technology Center,

Inc.

April 2006 Senior Executive Officer of the Company, and Representative

Director and President of Konica Minolta Technology Center,

Inc.

June 2006 Director and Senior Executive Officer of the Company, and

Representative Director and President of Konica Minolta

Technology Center, Inc.

April 2009 Director, President and CEO, and Representative Executive

Officer of the Company

April 2014 Director and Chairman of the Board of the Company

(positions which he continues to hold)

<Important position concurrently held>

President of Japan Business Machine and Information System Industries

Association

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2

Shoei Yamana

(November 18,

1954)

Up for

re-election


the Company held】

25,000 shares

April 1977 Joined Minolta Camera Co., Ltd.

July 1996 General Manager of Management Planning Div. of Minolta

Co., Ltd.

January 2001 CEO of Minolta QMS Inc.

July 2002 Executive Officer, General Manager of Management

Planning Div., Deputy General Manager of Image

Information Products General Headquarters, Image

Information Products Company of Minolta Co., Ltd.

August 2003 Senior Executive Officer of the Company, and Executive

Officer and General Manager of MFP Operations and Deputy

General Manager of Image Information Products General

Headquarters, Image Information Products Company of

Minolta Co., Ltd.

October 2003 Senior Executive Officer of the Company, and Managing

Director of Konica Minolta Business Technologies, Inc.

April 2006 Senior Executive Officer of the Company

June 2006 Director and Senior Executive Officer of the Company

April 2011 Director and Senior Executive Officer of the Company, and


Business Technologies, Inc.

April 2013 Director and Senior Managing Executive Officer of the

Company

April 2014 Director, President and CEO, and Representative Executive

Officer of the Company



None

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3

Shoji Kondo

(December 6, 1942)

Candidate for

outside director

Up for

re-election

【 Number of shares of

the Company held 】

0 shares

April 1965 Joined Toyota Motor Co., Ltd.

June 1997 Director of Toyota Motor Corporation

June 2001 Senior Executive Director of Toyota Motor Corporation

June 2003 Director and Vice-President of Hino Motors, Ltd.

June 2004 Representative Director and President of Hino Motors, Ltd.

June 2008 Representative Director and Chairman of Hino Motors, Ltd.

June 2011 Senior Corporate Advisor of Hino Motors, Ltd.

(position which he continues to hold)

June 2011 Director of the Company



Senior Corporate Advisor of Hino Motors, Ltd.

Reasons for selecting the candidate for outside director (Article 2, Paragraph 3, Item 7 of the

Regulation for Enforcement of the Company Law) and term of office

Mr. Shoji Kondo has many years of experience in the management of manufacturers at Toyota

Motor Corporation and Hino Motors, Ltd. He was involved primarily in production and purchase

activities, which are the main components of manufacturing. He has extensive experience and a

broad range of knowledge as a corporate executive. In addition, Mr. Kondo has a high degree of

independence from the Company.

Following his election as a director in June 2011, Mr. Kondo has performed well as a member of the

Board of Directors and other committees. Fiscal 2013 activities are listed in “Primary activities of

outside directors” in the business report (page 33). Mr. Kondo attended all meetings of the Board of

Directors in the fiscal year. Therefore, the Company believes that Mr. Kondo can continue contributing to the maintenance and

upgrading of corporate governance through the activities of the Board of Directors and the

committees, and requests shareholders to elect him as an outside director.

As of the close of the Meeting, Mr. Kondo will have served for three years.

Information concerning independence

Hino Motors, Ltd. and the Company are not major customers of each other because these sales

accounted for less than 1% of the consolidated net sales of each company. Furthermore, the two

companies are not major shareholders of each other.

Mr. Kondo meets the independence standards for outside directors established by the Company’s

Nominating Committee as well as the standards for independence of Tokyo Stock Exchange, Inc.

The Company has submitted a notice to this exchange designating Mr. Kondo as an independent

director as defined in Rule 436-2 of the Securities Listing Regulations of Tokyo Stock Exchange,

Inc.

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4

Hirokazu Yoshikawa

(October 25, 1942)

Candidate for

outside director

Up for

re-election

【 Number of shares of

the Company held 】

0 shares

April 1966 Joined Dowa Mining Co., Ltd.

June 1993 Director of Dowa Mining Co., Ltd.

June 1997 Managing Director of Dowa Mining Co., Ltd.

June 1999 Representative Director and Senior Managing Director of

Dowa Mining Co., Ltd.

April 2000 Representative Director and Vice-President of Dowa

Mining Co., Ltd.

April 2002 Representative Director, President and COO of Dowa

Mining Co., Ltd.

April 2003 Representative Director, President and CEO of Dowa

Mining Co., Ltd.

October 2006 Representative Director, Chairman and CEO of DOWA

HOLDINGS Co., Ltd.

April 2010 Representative Director and Chairman of DOWA

HOLDINGS Co., Ltd.

June 2011 Senior Corporate Advisor of DOWA HOLDINGS Co.,

Ltd.





Senior Corporate Advisor of DOWA HOLDINGS Co., Ltd.


Regulation for Enforcement of the Company Law) and term of office

Mr. Hirokazu Yoshikawa has many years of experience at DOWA HOLDINGS Co., Ltd. in the

management of non-ferrous metal smelting businesses and environmental and recycling businesses

while implementing business structural reforms and corporate reforms. In addition, Mr.

Yoshikawa had experience in the public sector as a member of advisory bodies of the Ministry of

the Environment, Cabinet Office and in other roles. He has extensive experience and a broad range

of knowledge as a corporate executive. In addition, Mr. Yoshikawa has a high degree of

independence from the Company.

Following his election as a director in June 2012, Mr. Yoshikawa has performed well as a member

of the Board of Directors and other committees. Fiscal 2013 activities are listed in “ Primary

activities of outside directors ” in the business report (page 33). Mr. Yoshikawa attended all

meetings of the Board of Directors in the fiscal year. Therefore, the Company believes that Mr. Yoshikawa can continue contributing to the

maintenance and upgrading of corporate governance through the activities of the Board of

Directors and the committees, and requests shareholders to elect him as an outside director.

As of the close of the Meeting, Mr. Yoshikawa will have served for two years.


There is a business relationship between DOWA Electronics Materials Co., Ltd., a subsidiary of

DOWA HOLDINGS Co., Ltd., and a manufacturing subsidiary of the Company. However,

DOWA HOLDINGS Co., Ltd. and the Company are not major customers of each other because

these sales accounted for less than 1% of the consolidated net sales of each company. Furthermore,

the two companies are not major shareholders of each other.

Mr. Yoshikawa meets the independence standards for outside directors established by the

Company’s Nominating Committee as well as the standards for independence of Tokyo Stock

Exchange, Inc. The Company has submitted a notice to this exchange designating Mr. Yoshikawa

as an independent director as defined in Rule 436-2 of the Securities Listing Regulations of Tokyo

Stock Exchange, Inc.

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5

Takashi Enomoto

(January 18, 1953)

Candidate for

outside director

Up for

re-election


the Company held】

0 shares

April 1975 Joined Nippon Telegraph and Telephone Public Corporation

June 2003 Director of NTT DATA Corporation

June 2007 Representative Director and Senior Executive Officer of

NTT DATA Corporation

June 2008 Representative Director and Vice-President of NTT DATA

Corporation

June 2012 Executive Advisor of NTT DATA Corporation





Executive Advisor of NTT DATA Corporation


Regulation for Enforcement of the Company Law)

Mr. Takashi Enomoto has many years of experience in the management of IT solutions businesses at

NTT DATA Corporation. He has extensive experience and a broad range of knowledge as a corporate

executive. In addition, Mr. Enomoto has a high degree of independence from the Company.

Following his election as a director in June 2013, Mr. Enomoto has performed well as a member of

the Board of Directors and other committees. Fiscal 2013 activities are listed in “Primary activities of

outside directors” in the business report (page 34). Mr. Enomoto attended all meetings of the Board of

Directors held after his election as a director in June 2013. Therefore, the Company believes that Mr. Enomoto can continue contributing to the maintenance and

upgrading of corporate governance through the activities of the Board of Directors and the

committees, and requests shareholders to elect him as an outside director.

As of the close of the Meeting, Mr. Enomoto will have served for one year.


The Company has a business relationship with NTT DATA Corporation that includes the payment to

this company of ERP software licensing fees and maintenance fees. However, NTT DATA

Corporation and the Company are not major customers of each other because these sales accounted

for less than 1% of the consolidated net sales of each company. Furthermore, the two companies are

not major shareholders of each other.

Mr. Enomoto meets the independence standards for outside directors established by the Company’s

Nominating Committee as well as the standards for independence of Tokyo Stock Exchange, Inc. The

Company has submitted a notice to this exchange designating Mr. Enomoto as an independent

director as defined in Rule 436-2 of the Securities Listing Regulations of Tokyo Stock Exchange, Inc.

Information concerning others

In the 2010 fiscal year, when Mr. Enomoto was a director of NTT DATA Corporation, a bribery

incident concerning payments by a former employee to a former employee of the Japan Patent Office

was discovered. NTT DATA Corporation performed an internal investigation by forming a committee

headed by the company president. There was also an investigation by a committee made up of

intellectuals from outside NTT DATA Corporation. Reports were subsequently announced and an

internal and external compliance declaration was made. For the internal investigation committee, Mr.

Enomoto served as the leader of the first investigation task force.

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6

Kazuaki Kama

(December 26,1948)

Candidate for

outside director

First-time

candidate


the Company held】

0 shares

July 1971 Joined IHI Corporation

(former Ishikawajima-Harima Heavy Industries Co., Ltd.)

June 2004 Executive officer, and General Manager of Finance &

Accounting Division of IHI Corporation

April 2005 Managing Executive Officer of IHI Corporation

June 2005 Director and Managing Executive Officer of IHI Corporation

April 2007 Representative Director and President & Chief Executive

Officer of IHI Corporation

April 2012 Representative Director and Chairman of IHI Corporation

(position which he continues to hold) <Important position concurrently held>

Chairman of the Board of IHI Corporation Director of Kyokuto Boeki Kaisha, Ltd. Representative Director of Japanese Aero Engines Corporation President of Japan Ship Exporters' Association President of Financial Accounting Standards Foundation


Regulation for Enforcement of the Company Law) At IHI Corporation, Mr. Kama was involved for many years in the management of the heavy

machinery manufacturing business, including progress of the focus of resources on strategic business

activities. He has extensive experience and a broad range of knowledge as a corporate executive. In

addition, Mr. Kama has a high degree of independence from the Company. Therefore, the Company

believes that Mr. Kama can contribute to the maintenance and upgrading of corporate governance

through the activities of the board of Directors and the committees, and requests shareholders to

newly elect him as an outside director. Information concerning independence

IHI Corporation and the Company are not major customers of each other because these sales

accounted for less than 1% of the consolidated net sales of each company. Furthermore, the two

companies are not major shareholders of each other.

Mr. Kama meets the independence standards for outside directors established by the Company’s

Nominating Committee as well as the standards for independence of Tokyo Stock Exchange, Inc. The

Company has submitted a notice to this exchange designating Mr. Kama as an eligible candidate of

independent director as defined in Rule 436-2 of the Securities Listing Regulations of Tokyo Stock

Exchange, Inc.

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7

Akio Kitani

(August 1, 1948)

Up for

re-election


the Company held】

38,363 shares


June 2001 Executive Officer of Minolta Co., Ltd., and President of Minolta

Europe GmbH

October 2003 Director of Konica Minolta Business Technologies, Inc., and

President of Konica Minolta Business Solutions Europe GmbH

June 2004 Executive Officer of the Company, and Director of Konica

Minolta Business Technologies, Inc., and President of Konica

Minolta Business Solutions Europe GmbH

April 2005 Executive Officer of the Company, and Managing Director of

Konica Minolta Business Technologies, Inc.

April 2006 Senior Executive Officer of the Company, and Representative

Director and President of Konica Minolta Business

Technologies, Inc.

June 2006 Director and Senior Executive Officer of the Company, and


Business Technologies, Inc.

April 2011 Director of the Company



None

8

Yoshiaki Ando

(November 16, 1951)

Up for

re-election


the Company held】

24,500 shares

April 1975 Joined Konishiroku Photo Industry Co., Ltd.

March 1994 Executive Vice-President and CFO of Konica Business

Machines U.S.A., Inc.

June 1998 General Manager of Planning Dept., Business Machines

Marketing Div., Business Machines Headquarters of Konica

Corporation

October 2002 Director of Konica Business Machines Co., Ltd.

October 2003 Director of Konica Minolta Business Solutions Japan Co., Ltd.

April 2005 General Manager of Corporate Finance Division of the

Company

April 2007 Executive Officer and General Manager of Corporate Finance

Division of the Company


June 2010 Director and Senior Executive Officer of the Company

April 2014 Director of the Company



None

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9

Takashi Sugiyama

(November 21, 1950)

Up for

re-election


the Company held】

28,000 shares


July 1997 General Manager of Design Division No.1, Image Information

Products Development Headquarters of Minolta Co., Ltd.

April 2001 General Manager of Development Center No.1 of Minolta Co.,

Ltd.

October 2003 Director of Konica Minolta Business Technologies, Inc.

April 2005 Executive Officer of the Company, and Senior Executive


April 2009 Senior Executive Officer of the Company, and Senior Executive



June 2011 Director and Managing Executive Officer of the Company

April 2013 Director and Senior Managing Executive Officer of the

Company



None

10

Ken Osuga

(March 4, 1963)

First-time

candidate


the Company held】

7,500 shares


April 2010 General manager of Sales Planning Dept., Sales Headquarters of


April 2011 President of Konica Minolta Business Solutions Europe GmbH

June 2012 Director of Konica Minolta Business Technologies, Inc. and

President of Konica Minolta Business Solutions Europe GmbH

April 2013 Executive Officer of the Company and President of Konica

Minolta Business Solutions Europe GmbH




None

11

Seiji Hatano

(December 17, 1959)

First-time

candidate


the Company held】

11,000 shares

April 1982 Joined the Mitsubishi Bank, Ltd.

June 2011 Resigned the Bank of Tokyo-Mitsubishi UFJ, Ltd.

July 2011 Joined the Company

April 2013 Executive Officer and General Manager of Corporate Strategy

Division of the Company

April 2014 Senior Executive Officer and General Manager of Corporate

Strategy Division of the Company



None

Notes 1. Mr. Masatoshi Matsuzaki, Mr. Shoei Yamana, Mr. Shoji Kondo, Mr. Hirokazu Yoshikawa, Mr.

Takashi Enomoto, Mr. Akio Kitani, Mr. Yoshiaki Ando and Mr. Takashi Sugiyama are currently

directors of the Company, and their positions and responsibilities at the Company are as specified

in “Names, etc. of directors and executive officers” on p.28~ p.30 of the Business Report.

2. No conflicts of interest exist between the Company and the director candidates.

3. The Company has entered into liability limitation agreements with outside directors Mr. Shoji

Kondo, Mr. Hirokazu Yoshikawa and Mr. Takashi Enomoto, the content of which is summarized

in “Liability limitation agreements” on p.34 of the Business Report. The Company will enter into

similar agreements with them if they are re-elected, and with Mr. Kazuaki Kama, the first-time

candidate for outside director, if he is elected.

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[Reference]

1. Regarding standards for the independence of outside directors, the Company’s Nominating

Committee selects outside director candidates with a high level of independence, provided that

none of the following criteria apply.

(1) Person affiliated with Konica Minolta

Former employee of the Konica Minolta Group

Having a family member (spouse, child, or any blood or marital relative twice removed or

less) that has served as a director, executive officer, auditor or top manager in the Konica

Minolta Group during the past five years

(2) Person affiliated with a major supplier/client

Currently serving as a managing director, executive officer, or employee of a major

supplier/client company/group that receives 2% or more of its consolidated sales from the

Konica Minolta Group or vice versa

(3) Specialized service provider (lawyer, accountant, consultant, etc.)

Specialized service provider that received annual compensation of ¥5 million or more from the

Konica Minolta Group for the past two years

(4) Other

A shareholder holding more than 10% of the voting rights in the Company (executive director,

executive officer, or employee in the case of a corporate body)

A director taking part in a director exchange

A director, executive officer, auditor or equivalent position-holder of a company that competes

with the Konica Minolta Group, or a person holding 3% or more of the shares of a competing

company

Having some other significant conflict of interest with the Konica Minolta Group

2. If the eleven directors are elected at the Meeting, the members of each of the committees under

the company-with-committees-system provided for in Article 2, Item 12 of the Company Law

will be appointed as follows from among three inside directors, Mr. Masatoshi Matsuzaki, Mr.

Akio Kitani and Mr. Yoshiaki Ando who do not concurrently hold executive officer posts, and the

four outside directors.

The Company appoints the Chairman of each committee especially from among outside

directors. The Representative Executive Officer and President serves as neither member of the

committees. Thus, the Company continues to strive to ensure the transparency of the

administration of three committees.

Nominating Committee Shoji Kondo (Chairman), Hirokazu Yoshikawa,

Kazuaki Kama, Masatoshi Matsuzaki, Akio Kitani

Audit Committee Takashi Enomoto (Chairman), Shoji Kondo,

Kazuaki Kama, Akio Kitani, Yoshiaki Ando

Compensation Committee Hirokazu Yoshikawa (Chairman), Takashi Enomoto,

Kazuaki Kama, Akio Kitani, Yoshiaki Ando

13

[Provided Document]

BUSINESS REPORT From April 1, 2013 to March 31, 2014

1. Overview of Konica Minolta Group business activities

(1) Konica Minolta Group developments and results of business activities

Looking back on the business environment in the consolidated fiscal year under review,

there was a feeling that the economy in Europe bottomed out around summer in 2013, and there

were signs that corporate results are on a recovery track. The United States continued to register

tones of recovery, characterized in particular by an improvement in the employment environment

and an increase in personal consumption. In Japan, results took a favorable turn, especially for

exporting companies on the back of persistent yen depreciation, and capital investment increased

steadily as well. In contrast, economic growth tapered off in emerging countries such as those in

Asia and Latin America as harsh conditions remained.

Looking at the main businesses in the consolidated fiscal year under review, in the

Business Technologies Business, sales of core color MFPs (Multi-functional peripherals) for the

office were strong, and sales volumes of color MFPs for the fiscal year increased compared with

the previous fiscal year in all regions worldwide, including Japan, the United States and Europe.

In particular, sales of high-segment models expanded. In the production print field, sales volumes

of both color units and monochrome units exceeded the previous fiscal year.

In the Industrial Business, sales volumes of TAC films for LCD polarizers and VA-TAC

films for increasing the viewing angle were down from the previous fiscal year in the display

materials field due to deterioration in market conditions for notebook PCs, and the impact of

inventory adjustments and diversification in components and materials used in TVs. In the

sensing field, the continued effect of M&As contributed to expansion in sales and profit. In the

optical products field, sales of pickup lenses for Blu-ray DiscsTM were strong. In the Healthcare

Business, sales of digital X-ray diagnostic imaging systems such as cassette-type Digital

Radiography (DR) systems increased in both Japan and overseas.

In addition, the Company implemented measures aimed at driving sustainable growth

during the fiscal year. In the Business Technologies Business, the Company enhanced our

proposal-making capabilities to customers through hybrid-type sales models that combine various

business solution services with MFPs and worked to expand sales of MFPs and boost high added

value. In the Industrial Business, the Company implemented structural reform promoting a shift

from business for the supply of components to product domains focused almost exclusively on

digital consumer electronics, which are easily impacted by fluctuations in demand, to businesses

related to industrial and professional use. In the Healthcare Business, the Company strengthened

the sales channel in the DR market, which is expected to grow, and created a business promotion

system for ultrasound diagnostic imaging equipment.

As a result, the consolidated net sales for the fiscal year under review of the Konica

Minolta Group (the “Group”) amounted to ¥943.7 billion, an increase of 16.1% year on year. In

addition to the effect of foreign exchange rates based on persistent yen depreciation, sales growth

of core products in the Business Technologies Business, improvement in product composition

and the effect of M&As in particular contributed to the increase in sales.

Operating income was ¥58.1 billion, an increase of 43.0% year on year. Although profit

was down in the Industrial Business, a significant increase in profit in the Business Technologies

Business due primarily to measures to increase sales and reduce costs contributed to the overall

increase in profit.

14

Ordinary income amounted to ¥54.6 billion, an increase of 40.4% year on year. Income

before income taxes and minority interests was ¥23.5 billion, down 30.5% year on year, due

primarily to the recording of loss on business withdrawal from the glass substrates for HDDs

business and the recording of impairment loss for structures associated with the termination of the

Group’s production for film in the Healthcare Business. Net income totaled ¥21.8 billion, an

increase of 44.5% year on year, after factoring in tax effects related to the impact of a review of

deferred tax assets in line with reorganization of the Group’s management system implemented in

April 2013.

Overview of Business Segments [Billions of yen]

Segment Net sales - external Operating income

Increase (Decrease) Increase (Decrease)

Business

Technologies

Business

729.8 148.2 25.5％ 63.8 32.2 101.8％

Industrial

Business 116.1 (30.6) -20.9％ 15.1 (8.5) -36.0％

Healthcare

Business 82.3 9.6 13.2％ 4.5 1.1 34.4％

Business conditions in each segment during the fiscal year under review are as follows.

Business Technologies Business Office field:

Sales of A3 color MFPs remained strong and sales volumes increased significantly compared with the previous fiscal year in all regions, including Japan, the United States and Europe, while the composition ratio of high-segment models increased, thereby contributing to sales expansion. Sales volumes of A3 monochrome units exceeded the previous year’s result in contracting markets from the second half due in part to the effect of new products, and consequently, sales remained roughly on par with the previous year on a full-year basis. Also, the Company steadily increased customer numbers and expanded business foundations for OPS (Optimized Print Services) as a result of strengthening systems on a global scale, expanding service menu and reinforcing business-creation and proposal-making capabilities. In addition, the Company established hybrid-type sales models that combine various IT business solution services with MFPs for small- and medium-sized companies in Europe and the United States and strengthened our proposal-making capabilities to customers. By doing so, the Company was able to cultivate new customers, expand business scale and boost added value. Production print field:

Sales volumes of color units and monochrome units exceeded the previous fiscal year. In addition, the Company expanded business for a wide variety of small-volume on-demand print services as well as production and print services for sales promotion materials by utilizing Kinko’s Japan Co., Ltd. and Charterhouse Print Management Limited (headquartered in the UK), which the Company acquired in the previous fiscal year. As a result, the Company is providing a wider selection to meet customers’ printing needs.

In Europe, the Company formed a capital and business alliance with MGI Digital Graphic Technology S.A. (headquartered in France), which has promoted unique business development in growth markets such as plastic card printing with the aim of developing applications for package printing in addition to paper output in the existing commercial printing market.

15

As a result, net sales of the Business Technologies Business to external customers stood at ¥729.8 billion, up 25.5% year on year, and operating income was ¥63.8 billion, up 101.8% year on year. Net sales were up year on year owing to the effect of foreign exchange rates based on persistent yen depreciation, sales growth of core color units, improvement in product composition and the effect of M&As. Operating income increased considerably year on year due to an increase in gross profit following sales expansion and the effect of foreign exchange rates coupled with the year-round effect of measures to reduce production costs that included decreasing fixed costs in the production division by promoting production reform and unit procurement, conducting centralized purchasing of raw materials and digital components, and implementing Value Engineering (VE) activities.

< Information about Kinko’s > Kinko’s Japan Co., Ltd. and Kinko’s Korea Ltd. operate stores and centralized printing

centers and are the leaders in the provision on-demand output services. These companies are meeting the increasing demand for the outsourcing of output operations by opening more stores and conducting sales activities that target companies (proposal-based sales for companies). The two companies offer customers the best possible solutions that utilize the store network and a document output environment at customers’ places of business.

Industrial Business

Display materials field:

Sales volumes of TAC films for LCD polarizers and VA-TAC films for increasing the

viewing angle both decreased compared with the previous fiscal year due to deterioration in the

market for notebook PCs and in addition to the effect of inventory adjustments and diversification

in components and materials used for TVs.

Sensing field:

The acquisition of Instrument Systems GmbH (headquartered in Germany) contributed to

net sales and profit growth.

Optical products field:

Although sales of pickup lenses for Blu-ray Discs used in games for the home and lenses

for large projectors were strong, lenses for cameras weakened due to a decline in demand.

As a result, net sales of the Industrial Business to external customers stood at ¥116.1

billion, down 20.9% year on year, and operating income was ¥15.1 billion, down 36.0% year on year.

< Light source color measurement solutions > The Company has supplied high –quality instruments that are the industry standard as the

leading manufacturer of color measurement instruments used for light source. Demand for the measurement of LED illumination products has increased rapidly in recent years. To meet this demand, The Company strengthened the lineup of color measurement instruments by acquiring Instrument Systems GmbH which is a leading company in light industry including LEDs and has advantage to technology and sale. This acquisition reinforced the Company’s industry position as a top global supplier of comprehensive color measurement solutions in displays and illumination industry and is expected to yield synergies with next-generation illumination businesses like OLED.

16

Healthcare Business

In the Healthcare Business, sales of the cassette-type Digital Radiography system “AeroDR” remained solid and sales volumes expanded in Japan and the United States while we are steadily increasing introductions of this product at large-scale medical institutions. The Company has gradually increased the number of projects the Company is engaged in based on collaborations with leading sales partners that the Company has been promoting in Europe and the United States. In film products, sales in emerging countries grew, with overall sales surpassing the previous fiscal year.

In addition, the Company established an integrated system from development to production and sales for ultrasound diagnostic imaging equipment, which is positioned as a new growth driver, by maximizing use of the resources gained following the transfer of the business from Panasonic Healthcare Co., Ltd., and pushed ahead with preparations for full-fledged business development.

As a result, net sales of the Healthcare Business to external customers stood at ¥82.3 billion, up 13.2% year on year, and operating income was ¥4.5 billion, up 34.4% year on year.

17

【Dividends and stock repurchases】

The Company plans to pay a fiscal year-end dividend of ¥7.50 per share, which is the same as one year earlier. With the dividend of ¥10 per share at the end of the first half (¥7.50 ordinary dividend and ¥2.50 commemorative dividend), this will result in an annual dividend of ¥17.50 per share.

On January 30, 2014, the Board of Directors approved a resolution as follows for the acquisition

of own shares in accordance with Article 156 of the Company Law, which is applied pursuant to

Article 165, Paragraph 3 of the Company Law.

(1) Shares to be acquired The Company’s common shares (2) Number of shares to be acquired Limited to 20 million shares (3) Total amount of shares to be acquired Limited to ¥20 billion (4) Acquisition period January 31, 2014 to April 30, 2014

Acquisition of own shares ended on April 14, 2014 as the maximum amount of these purchases

was reached.

【The Company included in the Dow Jones Sustainability Index】

The Company has been selected for the second consecutive year for inclusion in the Dow Jones Sustainability World Index (DJSI World), one of the world’s most respected indexes for socially responsible investing. The DJSI World uses the stock parameters of S&P Dow Jones Indices of the U.S. and RobecoSAM AG, a Swiss company that evaluates the sustainability of companies. The sustainability of companies is assessed with regard to the economy, the environment and society. For this year’s index, 2,500 large companies worldwide were assessed and 333 were selected for DJSI World. The 333 companies include 21 companies in Japan, including the Company.

In addition, the Company has been included for the past five consecutive years in the Dow Jones Sustainability Asia Pacific Index, the Asia-Pacific version of the DJSI.

In being included in the two Indices, the Company received the highest evaluation for innovation management, crisis management and other economic activities in the computers, peripherals and office equipment sector. Furthermore, the company earned a high score for environmental initiatives, including the environmental policy, management and other items.

18

(2) Financing, etc.

a. Financing In the fiscal year that ended in March 2014, there were no sales of stock or bonds or

other new fund procurement activities. Internal resources were used for capital expenditures, the repayment of loans (¥28.7 billion), stock repurchases (¥15.8 during the fiscal year) and other activities.

b. Capital expenditure The capital expenditure of the Group during the fiscal year under review totaled ¥47.3

billion, with the emphasis on expenditure for the construction of research and development facilities mainly in the Business Technologies Business and the Industrial Business. Significant expenditures included the production facilities for MFPs, production printing systems in the Business Technologies Business and the production facilities for functional film in the Industrial Business. (3) Business results of the last three fiscal years

107th Term

Fiscal Year Ended

March 31, 2011

108th Term

Fiscal Year Ended

March 31, 2012

109th Term

Fiscal Year Ended

March 31, 2013

110th Term

Fiscal Year Ended

March 31, 2014 (Fiscal year

under review)

Net sales (Millions of yen) 777,953 767,879 813,073 943,759

Operating income (Millions of yen) 40,022 40,346 40,659 58,144

Ordinary income (Millions of yen) 33,155 34,758 38,901 54,621

Net income (Millions of yen) 25,896 20,424 15,124 21,861

Net income per share (yen) 48.84 38.52 28.52 41.38

Total assets (Millions of yen) 845,453 902,052 940,553 966,060

Net assets (Millions of yen) 428,987 434,987 466,416 480,055

Net assets per share (yen) 806.53 817.81 876.65 929.04

Dividend per share (yen) [of which, interim dividend per share]

15

[7.5]

15

[7.5]

15

[7.5]

17.5

[10]

(4) Issues to be handled

The Company has commenced a new three-year medium term business plan called

“TRANSFORM 2016” that runs from fiscal 2014 to fiscal 2016.

Under this plan, the Company aims to fully understand its customers and transform into a

company that can provide high added value in order to outstrip global competition amid changes

in the management environment surrounding the Company. To achieve this, efforts are being

made to expand business content by innovating the Company’s business configuration from a

customer-oriented perspective with the service solution business as the nucleus aiming to resolve

the challenge of shifting from “product to service.” The plan was named “Transform 2016” to

reflect these concepts.

The Company has made preparations to mobilize all resources as one company following

reorganization of the management system in April 2013. By integrating products, technologies

and core competencies in a wide range of fields, the Company seeks to enter deeply into

customers’ industry and business, and provide high added value. In addition, efforts will be made

to drive sustainable growth by contributing to innovation in society, the environment and

customer companies through this kind of business.

19

(i) Management Targets In “Transform 2016,” the Company has drawn up objectives for fiscal 2018 with a view to

realizing our “vision five years from now.” To realize these, the Company is targeting net sales of at least ¥1.1 trillion, operating income of ¥90 billion and an operating income ratio of at least 8% in fiscal 2016, the final year of this plan, through initiatives based on this plan for the next three-year period. In addition, the Company will work to boost capital efficiency and aim to achieve an ROE of at least 10% by streamlining the balance sheet and strengthening shareholder returns. International Financial Reporting Standards (IFRS)

Medium-term management plan targets

(FY2016)

Vision five Years from now

(FY2018)

Net sales At least ¥1.1 trillion At least ¥1.3 trillion

Operating income ¥90 billion ¥130 billion

Operating income ratio At least 8% 10%

ROE At least 10% ―

*Assumed exchange rates during the period of the plan (FY2014-FY2016): U.S. dollar = ¥100; euro = ¥135

*The Company will apply International Financial Reporting Standards (IFRS) starting from securities reports released in fiscal

2014 (year ending March 31, 2015).

(ii) Basic Policy Under “TRANSFORM 2016,” the Company has decided on the following three items as

basic strategies to address over the next three years in order to realize our “vision five years from now.”

1. Realize sustainable profit growth 2. Reform to a customer-focused company 3. Establish a strong corporate structure

a. Realize sustainable profit growth Aiming to realize sustainable profit growth, the Company will promote a growth strategy in

each business field based on the following policies. <Business Technologies Business: Office Services Business Field> [Business Policy] The Company aims to expand sales and profit in this business by strengthening the ability to provide services and solutions befitting customer attributes and by bolstering relationships of trust with customers through enhancement of customers’ business efficiency.

The Company also seeks to increase the number of its MFPs in the market and color print volume by providing a digital workflow for each company size, region, industry and business type and contributing to improvements in customers’ business efficiency. In OPS, which is being deployed worldwide, efforts are being made to enhance service menu and boost delivery capability with the aim of creating foundations to transform into a services business toward the realization of a print-less society envisioned for the future. With regard to growing markets, the Company will position China, India, ASEAN nations and Brazil in particular as key markets and strengthen the sales system. <Business Technologies Business: Commercial and Industrial Printing Business Field> [Business Policy] The Company aims to realize the provision of commercial digital printing solutions from the perspective of the end-customer and expand the number of machines in the market and print volume. To achieve this, the Company will strive to meet all printing needs of major companies that are customers in the commercial printing sector by providing a variety of printing-related services that include our unique marketing print management service and on-demand print service by leveraging Charterhouse Printing Management Limited and Kinko’s Japan Co., Ltd., which have been acquired.

20

In addition, the Company will make use of its core digital electrophotographic and inkjet technologies toward full-fledged expansion into the industrial printing field, including textile printing, labeling and package printing. <Healthcare Business> [Business Policy] The Company will provide one-stop solutions that combine high-performance diagnostic instruments such as DR (digital radiography systems) and diagnostic ultrasound systems with medical IT services, and strive to expand sales of diagnostic instruments to small- and medium-sized hospitals and clinics while making these facilities more networked.

In the core cassette-type DR field, the Company will promote sales alliances with outside entities and seek to accelerate the expansion of sales overseas. In Japan, the Company will contribute to increased efficiency and sophistication of medical care through IT services that utilize a strong customer base and by enhancing and expanding regional partnerships. In diagnostic ultrasound systems, the Company aims to be the top of the genre in specific domains such as orthopedic surgery and internal medicine by way of our unique high-resolution technology. <Industrial Business: Optical Systems for Industrial Use Business Field> [Business Policy] The Company aims to expand business domain in the growth-potential industrial sector by innovating proposal-making ability accumulated in the sensing business and providing new value that includes equipment and solution/service.

In the sensing field, the Company will leverage synergies with Instrument Systems GmbH, which the Company acquired, to strengthen operations in the smartphone, tablet and automotive domains, and also establish a system that enables swift response to the needs of major customers. In the optical products field, the Company will utilize sensing technology and information processing technology centered around interchangeable lenses for DSLR cameras and projector lenses for digital cinema. At the same time, the Company aims to enter the optical systems field in areas that include non-destructive inspection systems for social infrastructure and safety and security services using monitoring systems for nursing facilities.

<Industrial Business: Performance Materials Business Field> [Business Policy] The Company aims to establish business foundations that realize growth by anticipating customer needs in growth fields and creating new businesses that originate from our unique technology accumulated in such areas as photo film, TAC film for LCD polarizers and VA-TAC film for increasing the viewing angle and OLED development.

In TAC film, the Company aims to secure sales volumes through the development of new thin-film-type products, an area of comparative advantage. In new businesses, which include OLED light sources and window film that help reduce environmental burden and make life more convenient, the Company seeks to sharpen value and establish mass-production technology together with customers in order to secure top position in growing markets. b. Reform to a customer-focused company

In order to drive business growth and realize higher added value, the Company will pay close attention to customer intentions and transform business processes with the customer used as the basis for decisions behind all business processes. The Company will strive to fully understand customer needs and workflow and look to maximize the value the Company provides to customers. To achieve this, the Company has established Business Innovation Centers in five cities worldwide for the purposes of business development. By doing so, the Company can expand framework as well as assign authority locally. In addition, the Company will conduct strategic alliances and M&As to complement the Company’s management resources.

Further, the Company will integrate our technologies and core competencies as well as create unique high-value-added solutions in all business domains.

21

c. Establish a strong corporate structure

The Company will create a strong corporate structure as a manufacturing business by “creating sturdy production operations” and “conducting corporate reform.” To this end, the Company will develop technology that leads to differentiation and enhances customer value, employ cost management in an integrated manner for development, procurement and production, and strengthen product lifecycle management that maximizes profit by visualizing the profitability of each product throughout the lifecycle. In corporate divisions, the Company will work on enhancing business productivity and reforming functions.

The Company will steadily implement measures set forth in our medium term business plan “TRANSFORM 2016” and strive to realize sustainable growth by transforming our business portfolio while enhancing corporate value.

(5) Main businesses of the Group at the fiscal year end

The main businesses of the Group are as follows.

Business segment Principal products

Business Technologies Business MFPs (Multi-functional peripherals), printers, equipment for

production print systems and graphic arts, etc.

Industrial Business Electronic materials, performance materials, optical products and

measuring instruments for industrial and healthcare applications, etc.

Healthcare Business Consumables and equipment for healthcare systems, etc.

(6) Major business offices, plants, etc. of the Group at the fiscal year end

a. Main business offices, plants, etc. of the Group

The Group consists of the Company, 123 subsidiaries and four affiliated companies. The

Group has product and technology development, manufacturing, and sales bases worldwide.

a) Offices of the Company

Head Office: Chiyoda-ku, Tokyo

Kansai Office: Osaka City, Osaka

b) Other domestic offices

Other domestic offices are located in Hino City (Tokyo), Hachioji City (Tokyo),

Toyokawa City (Aichi Prefecture), Sakai City (Osaka), Osakasayama City (Osaka),

Kobe City (Hyogo Prefecture) and other sites.

b. Employees of the Group

Number of employees Compared with end of

previous fiscal year

40,401 Decrease of 1,443

Note The number of employees indicates the number of employees currently on duty.

22

(7) Significant subsidiaries at the fiscal year end

Company name Capital

Ratio of

voting

rights held by the

Company

Description of principal

businesses

Konica Minolta Business Solutions Japan

Co., Ltd.

Millions of yen

497 100%

Sale of multi-functional peripherals

(MFPs), printers, equipment for

production print systems and graphic arts,

and related supplies in Japan, and

providing related solution services

Konica Minolta Health Care Co., Ltd. Millions of yen

397 100% Sale of consumables and equipment for

healthcare system in Japan

Konica Minolta Supplies Manufacturing

Co., Ltd.

Millions of yen

1,500 100% Manufacturing and sale of supplies for

multi-functional peripherals (MFPs) and

printers

Konica Minolta Technoproducts Co., Ltd. Millions of yen

350 100% Manufacturing and sale of equipment for

healthcare system

Konica Minolta Business

Solutions U.S.A., Inc.

Thousand US dollar

40,000 *100%


(MFPs), printers and related supplies in

the U.S., and providing related solution

services


Solutions Europe GmbH

Thousand euro

88,100 100%



Europe, and providing related solution

services


Solutions Deutschland GmbH

Thousand euro

10,025 *100%



Germany, and providing related solution

services


Solutions France S.A.S.

Thousand euro

26,490 *100%



France, and providing related solution

services


Solutions (UK) Ltd.

Thousand British pound

21,000 100%



the U.K., and providing related solution

services

Konica Minolta Business Solutions

Australia Pty. Ltd.

Thousand Australian

dollar

24,950 100%



Australia, and providing related solution

services


Solutions (CHINA) Co., Ltd.

Thousand RMB

96,958 100%



China, and providing related solution

services


Technologies Manufacturing (HK) Ltd.

Thousand HK dollar

195,800 100%

Manufacturing and sale of multi-

functional peripherals (MFPs) , printers,

and related supplies


Technologies (WUXI) Co., Ltd.

Thousand RMB

289,678 *100%


functional peripherals (MFPs), printers,



Technologies (DONGGUAN) Co., Ltd.

Thousand RMB

141,201 *100%


functional peripherals (MFPs, printers,


Konica Minolta Opto

(DALIAN) Co., Ltd.

Thousand RMB

244,675 100%

Manufacturing and sale of optical

products (pickup lenses, etc.)

(Note) The ratio of voting rights marked with * include those held by subsidiaries.

23

(8) Principal lenders and the amount of loans of the Group at the fiscal year end

[Millions of yen]

Lender Outstanding amount of loan

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 30,535

Sumitomo Mitsui Banking Corporation 13,946

Nippon Life Insurance Company 9,000

Resona Bank, Limited. 7,960

Mizuho Corporate Bank, Ltd. 3,958

(9) Policy on exercise of authority if Articles of Incorporation allow distribution of

dividends from retained earnings by the resolution of the Board of Directors (Article

459, Paragraph 1 of the Company Law)

The policy regarding resolutions on the payment of dividends from retained earnings, etc.

calls for the basic approach of making a comprehensive evaluation of consolidated performance

and funding requirements for promoting strategic investments in growth fields while seeking to

sustain shareholder returns. Regarding the specific dividend target, the Company is aiming to

sustain a dividend payout ratio of 25% or higher on a consolidated basis over the medium-to-

long term. With respect to the acquisition of treasury stock, the Company intends to make

appropriate decision regarding treasury stock acquisition as a means of profit distribution while

giving due attention to such factors as the Company’s financial condition and stock price trends.

(10) Other significant matters of the Group

The Company merged with the following seven group companies through acquisition and

changed its trade name to Konica Minolta, Inc.


Konica Minolta Advanced Layers, Inc.

Konica Minolta Optics, Inc.

Konica Minolta Medical & Graphic, Inc.

Konica Minolta IJ Technologies, Inc.

Konica Minolta Technology Center, Inc.

Konica Minolta Business Expert, Inc.

24

2. State of shares at the fiscal year end

(1) Total number of shares authorized to be issued ······· 1,200,000,000 shares

(2) Total number of shares issued ····························· 531,664,337 shares

(of which, treasury stock 16,720,688 shares)

(3) Number of shareholders ···································· 26,191

(4) Major shareholders (the top ten shareholders)

Name of shareholder Number of

shares held (thousand shares)

Ratio of shares

held (%)

Japan Trustee Services Bank, Ltd. (Trust account) 30,054 5.8

The Master Trust Bank of Japan, Ltd. (Trust account) 28,950 5.6

The Bank of Tokyo-Mitsubishi UFJ, Ltd. 13,945 2.7

JPMorgan Chase Bank 385167 11,948 2.3

Japan Trustee Services Bank, Ltd.

(Sumitomo Mitsui Trust Bank, Limited Retrust Portion, Sumitomo Mitsui

Banking Corporation Pension Trust Account)

11,875 2.3

Nippon Life Insurance Company 11,409 2.2

The Nomura Trust and Banking Co., Ltd.

(Holder in Retirement Benefit Trust for the Bank of Tokyo-Mitsubishi

UFJ, Ltd.)

10,801 2.1

SAJAP 10,730 2.1

DAIDO LIFE INSURANCE COMPANY 9,040 1.8

CMBL S.A. RE MUTUAL FUNDS 7,254 1.4

Note:

1. The list of major shareholders does not include the 16,720,688 shares of treasury stock held by the Company.

2. Ratio of shares held is calculated by deducting treasury stock.

25

3. Stock acquisition rights, etc. of the Company

Summary of stock acquisition rights, etc., issued to/held by directors and officers of the

Company as compensation for the execution of duties at the fiscal year end

Starting in fiscal 2005, the Company began issuing stock acquisition rights to directors

(excludes outside directors) and executive officers in the form of a compensation-type stock

option plan, in accordance with its compensation determination policy.

Upon the exercise of stock acquisition rights, treasury stock owned by the Company will

be transferred.

First Series Fiscal Year Ended

March 31, 2006

Second Series Fiscal Year Ended

March 31, 2007

Third Series Fiscal Year Ended

March 31, 2008 Number of stock acquisition

rights 389 211 226

Type and number of shares

under stock acquisition rights

Common shares

194,500 shares

Common shares

105,500 shares

Common shares

113,000 shares

Amount to be paid upon

exercise of the stock

acquisition rights

One (1) yen per

share

One (1) yen per

share

One (1) yen per

share

Exercise period of stock

acquisition rights August 23, 2005 -

June 30, 2025

September 2, 2006 -

June 30, 2026

August 23, 2007 -

June 30, 2027

Primary condition for exercise

of stock acquisition rights

The Optionee shall exercise stock acquisition rights during

the period from one (1) year after the date of retirement from

the post of director or executive officer of the Company up

until five (5) years from that starting date.

Primary events and conditions

for acquisition of stock

acquisition rights

The Company may acquire stock acquisition rights without

any compensation if the General Meeting of Shareholders

approves merger agreement in which the Company becomes

the dissolving company, etc.

Holdings

of

directors

and

executive

officers

Number of

holders 8 8 10

Number of

rights 115 84 101

Number of

shares 57,500 shares 42,000 shares 50,500 shares

26

Fourth Series Fiscal Year Ended

March 31, 2009

Fifth Series Fiscal Year Ended

March 31, 2010

Sixth Series Fiscal Year Ended


rights 256 399 376



Common shares

128,000 shares

Common shares

199,500 shares

Common shares

188,000 shares



acquisition rights

One (1) yen per

share

One (1) yen per

share

One (1) yen per

share



June 30, 2028 August 20, 2009 -

June 30, 2029 August 28, 2010 -

June 30, 2030



The Optionee shall exercise stock acquisition rights during

the period from one (1) year after the date of retirement from

the post of director or executive officer of the Company up

until five (5) years from that starting date.



acquisition rights





Holdings

of

directors

and

executive

officers

Number of

holders 13 14 16

Number of

rights 136 237 270

Number of


27

Seventh Series Fiscal Year Ended

March 31, 2012

Eighth Series Fiscal Year Ended

March 31, 2013

Ninth Series Fiscal Year Ended


rights 479 571 515



Common shares

239,500 shares

Common shares

285,500 shares

Common shares

257,500 shares



acquisition rights

One (1) yen per

share

One (1) yen per

share

One (1) yen per

share



June 30, 2031 August 23, 2012 -

June 30, 2032

August 23, 2013 -

June 30, 2043



The Optionee shall exercise stock

acquisition rights during the period

from one (1) year after the date of

retirement from the post of director or

executive officer of the Company up

until five (5) years from that starting

date.

The Optionee shall

exercise stock

acquisition rights

during the period

from one (1) year

after the date of

retirement from the

post of director or

executive officer of

the Company up

until ten (10) years

from that starting

date.



acquisition rights





Holdings

of

directors

and

executive

officers

Number of

holders 18 23 27

Number of

rights 385 529 515

Number of


28

4. Status of the Company’s management members

(1) Names, etc. of directors and executive officers

a. Directors

Position Name Responsibilities Important positions

concurrently held

Director Yoshikatsu Ota Chairman of the Board

Member of Nominating Committee

Director of YAMAHA

CORPORATION

Director Masatoshi Matsuzaki (President and CEO, and Representative

Executive Officer)

Outside

Director Nobuhiko Ito

Member of Compensation Committee

(Chairman)


Director of TADANO LTD.

Outside

Director Shoji Kondo


(Chairman)

Member of Audit Committee

Senior Corporate Advisor of

Hino Motors, Ltd.

Outside

Director Hirokazu Yoshikawa

Member of Audit Committee (Chairman)


Senior Corporate Advisor of

DOWA HOLDINGS Co., Ltd.

Outside

Director Takashi Enomoto




Executive Advisor of NTT

DATA Corporation

Director Yasuo Matsumoto Member of Nominating Committee



Director Akio Kitani Member of Audit Committee


Director Shoei Yamana (Senior Managing Executive Officer)

Director Takashi Sugiyama (Senior Managing Executive Officer)

Director Yoshiaki Ando (Senior Executive Officer)

Notes 1. The four directors Mr. Nobuhiko Ito, Mr. Shoji Kondo, Mr. Hirokazu Yoshikawa and Mr. Takashi

Enomoto are outside directors, as provided for in Article 2, Item 15 of the Company Law and

independent directors, as provided for under Rule 436-2 of the Securities Listing Regulations of

Tokyo Stock Exchange, Inc.

2. At the 109th Ordinary General Meeting of Shareholders held on June 19, 2013, the terms of office of

all eleven (11) directors expired. The following ten directors were reelected: Mr. Yoshikatsu Ota,

Mr. Masatoshi Matsuzaki, Mr. Nobuhiko Ito, Mr. Shoji Kondo, Mr. Hirokazu Yoshikawa, Mr.

Yasuo Matsumoto, Mr. Akio Kitani, Mr. Shoei Yamana, Mr. Mr. Takashi Sugiyama and Mr.

Yoshiaki Ando; and Mr. Takashi Enomoto was newly elected and assumed office the same day.

3. Upon the close of the 109th Ordinary General Meeting of Shareholders held on June 19, 2013, the

term of office of Mr. Yozo Izuhara expired and he retired from the office of director.

4. Audit Committee member Mr. Yasuo Matsumoto had been in charge of the corporate accounting and

corporate finance of the Company as the senior executive officer and has considerable knowledge of

corporate finance and corporate accounting.

29

b. Executive Officers

Position Name

Responsibilities and

important positions concurrently held

* President and CEO,

and Representative

Executive Officer

Masatoshi Matsuzaki In charge of Corporate CSR & Communications & Branding

Division

* Senior Managing

Executive Officer Takashi Sugiyama

In charge of Corporate R&D, Corporate IT Planning Division and

Corporate Production Operations

* Senior Managing

Executive Officer Shoei Yamana In charge of Business Technologies Business

Senior Executive

Officer Takashi Matsumaru General Manager, Corporate R&D Headquarters

* Senior Executive

Officer Yoshiaki Ando

In charge of Corporate Business Management Division, Corporate

Accounting Division, Corporate Finance Division and Risk

Management

Senior Executive

Officer Masaru Kamei

In charge of Corporate Legal Affairs & General Affairs Division,

Intellectual Property Center, Compliance and Crisis Management

General Manager of Kansai Headquarters

Senior Executive

Officer Atsushi Kodama Healthcare Company President

Senior Executive

Officer Nobuyasu Ieuji

In charge of Corporate Social Responsibility Operations and

Corporate SCM Center

Senior Executive

Officer Toshihiko Karasaki Optics Company President

Senior Executive

Officer Yoshitsugu Shiraki Advanced Layers Company President

Senior Executive

Officer Jun Haraguchi

General Manager, Business Technologies Business Sales

Headquarters

Executive Officer Masami Akiyama General Manager, Advanced Layers Company Performance

Materials Business

Executive Officer Kazuyoshi Hata

In charge of Healthcare Company, Responsible for R&D

Operations, Product Planning Operations, Healthcare IT Solutions

Operations, General Planning Division, and Management

Administration Division

Executive Officer Akiyoshi Ohno General Manager, Inkjet Business Unit.

Executive Officer Tsukasa Wakashima General Manager, Corporate Human Resources Division

Executive Officer Shingo Asai General Manager, Business Technologies Business Manufacturing

Headquarters

Executive Officer Kunihiro Koshizuka General Manager, Corporate R&D Headquarters Technology

Strategy Division, Responsible for Technology R&D Center 1&2

Executive Officer Ken Shiomi Optics Company, Responsible for Planning & Administration

Operations

Executive Officer Hiroyuki Suzuki General Manager, Corporate Audit Division

Executive Officer Tomio Nakamura Optics Company, General Manager, Hard Disk Business Unit

Responsible for U&C Business

Executive Officer Toyotsugu Ito General Manager, Corporate Production Operations

Executive Officer Ken Osuga President, Konica Minolta Business Solutions Europe GmbH

Executive Officer Kenichi Sanada General Manager, Corporate Intellectual Property Center

Executive Officer Seiji Hatano General Manager, Corporate Strategy Division

Notes 1. Executive officers marked with * hold concurrent director positions.

2. The above executive officers were, after the close of the 109th Ordinary General Meeting of

Shareholders held on June 19, 2013, elected at the meeting of the board of directors held the same

day.

3. Mr. Masatoshi Matsuzaki, Mr. Takashi Matsumaru, Mr. Yoshiaki Ando, Mr. Masaru Kamei, Mr.

Atsushi Kodama, Mr. Toshihiko Karasaki and Mr. Masami Akiyama resigned as senior executive

officers as of March 31, 2014.

30

4. Mr. Shoei Yamana was promoted to Representative Executive Officer and President and Mr. Ken

Osuga, Mr. Kunihiro Koshizuka, Mr. Seiji Hatano and Mr. Tsukasa Wakashima were promoted to

senior executive officer as of April 1, 2014. Mr. Akira Tai and Mr. Ikuo Nakagawa newly assumed

executive officer posts as of the same date. Executive officers and its responsibilities changed as of

April 1, 2014 as follows.

Position Name Responsibilities,

important positions concurrently held

President and CEO,

and Representative

Executive Officer

Shoei Yamana

Senior Managing

Executive Officer Takashi Sugiyama

In charge of Corporate R&D Headquarters, Corporate IT

Planning Division and Corporate Production Operations

General Manager of Business Technologies Business

Development Headquarters

Senior Executive

Officer Nobuyasu Ieuji

In charge of Corporate Social Responsibility Operations,

Corporate SCM Center and Business Technologies Business

Quality Assurance Operations

General Manager of Kansai Headquarters

Senior Executive

Officer Yoshitsugu Shiraki Advanced Layers Company President

Senior Executive

Officer Jun Haraguchi

General Manager of Business Technologies Business

Marketing Headquarters

Senior Executive

Officer Ken Osuga

In charge of Corporate Business Management Division,

Corporate Accounting Division, Corporate Finance Division

and Risk Management and Business Technologies Business,

Business Process Transformation Operations

Senior Executive

Officer Kunihiro Koshizuka General Manager, Corporate R&D Headquaters

Senior Executive

Officer Seiji Hatano

General Manager, Corporate Strategy Division

In charge of Corporate CSR & Communications & Branding

Division

Senior Executive

Officer Tsukasa Wakashima General Manager, Corporate Human Resources Division

Executive Officer Kazuyoshi Hata Healthcare Company President

Executive Officer Akiyoshi Ohno General Manager, Inkjet Business Unit

Executive Officer Shingo Asai General Manager, Business Technologies Business

Manufacturing Headquarters

Executive Officer Ken Shiomi Optics Company, Responsible for Planning & Administration Operations

Executive Officer Hiroyuki Suzuki General Manager, Corporate Audit Division

Executive Officer Tomio Nakamura Optics Company President

Executive Officer Toyotsugu Ito General Manager, Corporate Production Operations

Executive Officer Kenichi Sanada In charge of Intellectual Property Center, Corporate Legal

Affairs & General Affairs Division, Compliance and Crisis

Management

Executive Officer Akira Tai General Manager, Corporate IT Planning Division

Executive Officer Ikuo Nakagawa President, Konica Minolta Business Solutions Europe GmbH

31

(2) Total compensation to directors and executive officers

Compensation (Millions of yen)

Total Base salary

Performance-

based cash bonus

Stock

compensation-

type stock options

Persons Amount Persons Amount Persons Amount

directors Outside 43 5 43 - - - -

Inside 156 3 127 - - 3 28

Total 199 8 170 - - 3 28

Executive Officers 926 24 551 24 238 24 136 Notes 1. At the end of the period (March 31, 2014), the Company has four (4) outside directors, three (3)

inside directors (not concurrently holding executive officer posts) and twenty-four (24) executive

officers.

2. In addition to the three (3) inside directors shown above, the Company has another four (4) inside

directors who concurrently hold executive officer posts, and the compensation to these directors is

included in compensation to executive officers.

3. Regarding the performance-based cash bonus, the amounts which should be recorded as expense in

the period are stated.

4. Regarding the compensation-type stock options, the amounts which should be recorded as expense

based on an estimation of the fair value of the stock acquisition rights issued to directors (excluding

outside directors) and executive officers as part of their compensation are stated.

5. In addition to the compensation shown in this table, the following payments were made during the

fiscal year that ended in March 2014 due to a resolution by the Compensation Committee based on

the retirement payment system that was terminated in June 2005. ・Executive Officer (two) 2 million yen (Retired on March 31, 2013)

(3) Summary of policy for determining amount of director or executive officer

compensation and the method of calculation

The Company, which has adopted the company-with-committees system, has established

a Compensation Committee. Outside directors account for the majority of members of the

committee and the committee is chaired by an outside director to ensure transparency and to

determine compensation in a fair and appropriate manner.

The Company’s directors’ compensation system is intended to strengthen the motivation

of directors and executive officers to strive for the continuous medium-to-long-term

improvement of the Group performance in line with management policies to meet shareholder

expectations, and to contribute to the optimization of the Group value. The Company aims for a

level of compensation that enables it to attract and retain talented people to take responsibility

for the Company’s development.

In keeping with these aims, the Compensation Committee has established a policy for

determining the individual compensation entitlement of directors and executive officers as set

out below, and determines the amount, etc. of individual compensation entitlement of directors

and executive officers in line with this policy.

1. Compensation system

(1) Compensation packages for directors (excluding directors who concurrently hold

executive officer posts) exclude a short-term performance-based cash bonus

because directors have a supervisory role, and consist of a “base salary” component

in the form of a base salary and long-term incentives in the form of “compensation-

type stock options.” Outside directors receive base salary only.

(2) Executive officer compensation packages consist of “base salary,” “performance-

based cash bonus,” which reflects the short-term performance of the Group and the

32

short-term performance of the business of which they are in charge, and

“compensation-type stock options” as a long-term incentive.

2. The total amount of individual compensation entitlement and “Base salary” are set at

an appropriate level for each position, based upon objective data, evaluation data and

other data collected at regular intervals, etc.

3. The amount of the “performance-based cash bonus” is determined according to the

level of performance result for the fiscal year (consolidated operating income) and the

degree of attainment of annual performance targets. The amount based on the degree

of attainment of annual performance targets is determined in the 0 % to 200 % range

of the standard amount of compensation. The targets are major consolidated

performance indicators (sales, operating income, ROE and others) associated with

results of operations.

4. Regarding the “compensation-type stock options,” the Company grants stock

acquisition rights to inside directors and executive officers as share-price based

incentives from a shareholder perspective. The number of rights granted is

determined based on the position.

5. The standard for compensation to executive officers is a 60:25:15 mix of “base

salary,” “performance-based cash bonus” and “compensation-type stock options.” For

the executive officers ranked in a more senior position, the “base salary” ratio is

lowered while the ratio of “performance-based cash bonus” is increased.

6. The Company reviews matters such as the level of compensation and the

compensation structure in a timely and appropriate manner in response to changes in

the business environment.

Regarding the conventional retirement benefit system abolished in June 2005, the

Compensation Committee has determined individual entitlements within reason based upon

certain criteria established by the Company, and will pay such entitlement upon the retirement of

each director or executive officer in office prior to the abolition of this system.

33

(4) Matters regarding outside directors

a. Persons serving as executive officers at the important positions of other companies, etc.

Not applicable.

b. Persons serving as outside directors at the important positions of other companies, etc.

Name Name of company, etc. Position

Nobuhiko Ito TADANO LTD. Outside director

There is no material transaction with the Company.

c. Family relationship with an executive officer, etc. of the Company or of a specified

related business operator of the Company

Not applicable.

d. Primary activities of outside directors

Outside directors of the Company participate in Board of Directors meetings by making

constructive statements on the decision-making and supervision of management, and they are

also in charge of duties of the three committees: the Nominating Committee, the Audit

Committee and the Compensation Committee, as stated in “(1) Names, etc. of Directors and

Executive Officers.” Also, where appropriate, outside directors also observe development,

production and marketing and other actual operations as part of their supervision and auditing

work, and exchange information with the President, the Chairman and other Directors of the

Board on various aspects including the running of Board of Directors meetings. The principal

activities of outside directors are as follows.

a) Mr. Nobuhiko Ito

During the fiscal year that ended in March 2014, Mr. Ito attended all 14 meetings of

the Board of Directors, six of seven meetings of the Nominations Committee, all

three meetings of the Audit Committee that were held when he was a committee

member until June 2013, and all five meetings of the Compensation Committee that

were held starting in June 2013. As a director, Mr. Ito used his experience as a

manager to provide supervision and advice concerning global and M&A strategies,

risk management and other subjects for preparation of the medium-term plan. In

addition, as the chairman of the Audit Committee, Mr. Ito used his experience and

knowledge to make statements as needed at meetings of this committee until June

2013.

b) Mr. Shoji Kondo

During the fiscal year that ended in March 2014, Mr. Kondo attended all 14

meetings of the Board of Directors, all seven meetings of the Nominations

Committee, all 10 meetings of the Audit Committee that were held after he was

named to this committee in June 2013, and one meeting of the Compensation

Committee when he was a member until June 2013. As a director, Mr. Kondo used

his experience as a manager to provide supervision and advice concerning

manufacturing and procurement strategy, human resources strategy and other

subjects for preparation of the medium-term plan. In addition, as a member of the

Audit Committee starting in June 2013, Mr. Kondo used his experience and

knowledge to make statements as needed.

c) Mr. Hirokazu Yoshikawa

During the fiscal year that ended in March 2014, Mr. Yoshikawa attended all 14

meetings of the Board of Directors, all 13 meetings of the Audit Committee, and

five of the six meetings of the Compensation Committee. As a director, Mr.

34

Yoshikawa used his experience as a manager to provide supervision and advice

concerning organizational and human resources strategies, brand strategies and

other subjects for preparation of the medium-term plan. In addition, as a chairman

of the Audit Committee starting in June 2013, Mr. Yoshikawa used his experience

and knowledge to make statements as needed.

d) Mr. Takashi Enomoto (elected at the Ordinary General Meeting of Shareholders held

June 2013)

He attended all 11 Board of Directors meetings held after his appointment, all seven

Nominating Committee meetings, all 10 Audit Committee meetings, and all five

Compensation Committee meetings, which were respectively held during the fiscal

year. At Board of Directors meetings, when preparing the medium-term plan, he

primarily made statements on solution business, strategies of financial and other

subjects, as necessary and appropriate, for the supervision of and the advice on

management from the perspective of a highly experienced management. At the

Audit Committee, he made appropriate and necessary statements with his

experienced deep knowledge.

e. Liability limitation agreements

To attract skillful people as outside directors and to enable them to fully demonstrate their

expected role, the Company stipulates in its current Articles of Incorporation that the Company

may, pursuant to the provisions of Article 427, Paragraph 1 of the Company Law, enter into an

agreement with outside directors which limits their liabilities for payment of damages with

respect to the acts mentioned in Article 423, Paragraph 1 of the Company Law to the extent

permitted by laws and regulations. Based on these stipulations, the four outside directors Mr.

Nobuhiko Ito, Mr. Shoji Kondo, Mr. Hirokazu Yoshikawa and Mr. Takashi Enomoto have

entered into an agreement with the Company limiting their liabilities for payment of damages,

and the content of this agreement is summarized as follows.

The maximum amount of liability of an outside director who, with the best of intentions

and without gross negligence, fails to execute his or her duties while in office and causes damage

to the Company shall be limited to the aggregate sum of the amounts prescribed in Article 113 of

the Company Law Enforcement Regulations multiplied by two (Article 425, Paragraph 1, Item 1

(c) of the Company Law).

35

5. Status of Independent Auditor

(1) Name of Independent Auditor

KPMG AZSA LLC

(2) Compensation to the Independent Auditor

a. Compensation paid by the Company to the Independent Auditor during the fiscal year

under review

Compensation for audit certification in accordance with Article 2, Section 1

of the Certified Public Accountants Law ¥177 million

Compensation for services other than those stipulated in Article 2, Section 1

of the Certified Public Accountants Law ¥9 million

Total ¥186 million Note Compensation is the total of compensation for the Independent Auditor’s audit under the Company Law

and audit compensation under the Financial Instruments and Exchange Law, as there is no clear

separation between the two.

b. Total amount of other property benefits paid by the Company and its subsidiaries

¥268 million

(3) Details of services other than auditing

The Company paid KPMG AZSA LLC to consign the advisory service about

reorganization of the Group management structure and the introduction of International Financial

Reporting Standards.

(4) Policy regarding decisions to dismiss or deny reappointment to Independent Auditor

The Audit Committee will examine dismissing or denying reappointment of the

Independent Auditor if the Independent Auditor has committed a serious violation or

infringement of the Company Law, the Certified Public Accountants Law or other relevant laws

or regulations, or if the Independent Auditor is deemed to have committed a serious breach of

public order or custom. If, as a result of this examination, it is deemed appropriate to dismiss or

deny reappointment, the Audit Committee will request the Board of Directors to submit a

proposition calling for the dismissal or denial of reappointment of the Independent Auditor to the

General Meeting of Shareholders pursuant to the provisions of Article 339, Paragraph 1 and

Article 404, Paragraph 2, Item 2 of the Company Law.

The Audit Committee also examines the status of the performance of the Independent

Auditor and decides the reappointment or denial every fiscal year.

36

6. Establishment of system to ensure appropriate business operations

The Board of Directors of the Company adopted resolutions on the matters prescribed by

the applicable Ordinance of the Ministry of Justice as those necessary for the execution of the

duties of the Audit Committee (Article 416, Paragraph 1, Item 1 (b) of the Company Law), and

on the establishment of systems necessary to ensure that the execution of duties by executive

officers complies with laws and regulations and the Articles of Incorporation, and other systems

prescribed by the applicable Ordinance of the Ministry of Justice as systems necessary to ensure

the properness of operations of a Stock Company (Article 416, Paragraph 1, Item 1 (e) of the

Company Law). A summary of the resolutions is as follows.

<I. Requirements for the execution of duties by the Audit Committee>

1. The Company set up the Audit Committee Office with a full-time staff to support the

Audit Committee, and, besides being the secretariat of the Audit Committee, the

Audit Committee Office shall perform its duties in accordance with the instructions

of the Audit Committee.

2. To ensure the independence of the above Audit Committee Office from executive

officers, personnel matters regarding the Audit Committee Office including

appointment, personnel changes and disciplinary action, shall be approved in advance

by the Audit Committee.

3. The executive officers in charge of internal control, including the Corporate Audit

Division, Risk Management Committee and the Compliance Committee, shall report

on the status of operation to the Audit Committee on a regular basis and without

delay if an urgent situation that must be reported has arisen or if requested to make a

report by the Audit Committee.

4. Audit Committee members elected by the Audit Committee may attend management

council meetings and other important meetings if necessary and may request

investigations, reports, etc. to the executive officers in charge of internal control,

including the Corporate Audit Division, Risk Management Committee and the

Compliance Committee.

<II. Systems for ensuring compliance of execution of duties by executive officers with

laws, regulations and the Articles of Incorporation and other required systems for

ensuring the properness of business operations>

5. Each executive officer shall manage the minutes of management council meetings

and other important meetings, documents requesting formal approval and other

information concerning the performance of their duties to ensure that documents are

preserved in an appropriate manner and made available for inspection in accordance

with the provisions of the executive officer document management rules and internal

rules concerning the management of other documents.

6. The Company set up the Risk Management Committee which is in charge of

managing the various risks that arise in connection with the Group’s business

activities, and the executive officer nominated by the Board of Directors shall be

responsible for the development of risk management systems including the following,

in accordance with the Risk Management Committee Regulations.

(1) With respect to management of the business strategy risks, the executive officer

in charge of business strategy shall be responsible, and regarding management

of other risks in connection with business activities, each executive officer shall

be responsible in accordance with respective assigned area. The Risk

Management Committee shall provide support to each executive officer. Further,

the Risk Management Committee shall periodically conduct selection,

37

assessment and review of material risks, develop measures, and confirm

management status.

(2) The executive officer in charge of risk management nominated by the Board of

Directors shall be responsible for establishing the contingency plans and

countermeasures to minimize the damages by a crisis which is supposed to

adversely affect the corporate value.

(3) Provide support to the development and strengthening of risk management

systems at each group company.

7. The Company set up the Compliance Committee which is in charge of establishing

and operating the Group’s compliance systems, and the executive officer nominated

by the Board of Directors shall be responsible for establishing and operating the

compliance systems including the following, in accordance with the Compliance

Committee Regulations.

(1) Defining compliance in the Group as the observance of laws and regulations

applicable to corporate activities, corporate ethics and internal regulations and

policies, and making this known to every individual working for the Group.

(2) Establishing the Konica Minolta Group Charter of Corporate Behavior,

familiarizing this through the Group, and enacting compliance conduct

guidelines, etc. based on the philosophy of the Charter of Corporate Behavior.

(3) Establishing and operating systems to promote compliance at each group

company.

(4) Establishing and operating a whistle blowing system that allows employees to

report any compliance violations that are discovered or anticipated.

8. The Company set up a Corporate Audit Division which is in charge of the internal

auditing of the Group to evaluate and improve the status of execution of business

operations in all business activities from the viewpoint of legality and rationality, and

which shall be responsible for establishing and operating internal auditing systems in

accordance with the Internal Auditing Regulations.

9. The Company shall be responsible for establishing and operating a system of internal

control over financial reporting in the Group and a system for evaluating the efficacy

of their operation.

10. The Company established the Corporate Organization Basic Regulations, and shall

develop the corporate governance mechanisms of the Company and the Group,

including the foregoing systems. The Company shall also work to establish and

operate a system for ensuring the appropriateness of business operation through the

management council and other meeting bodies, authority regulations and other

internal regulations, and shall endeavor to ensure the legality, rationality and

efficiency of business execution by reviewing as necessary systems for management

and administration across all the business activities of the Group.

*Amounts and numbers of shares shown in this business report are rounded down to the nearest

whole unit.

38

Consolidated Balance Sheet (As of March 31, 2014) [Millions of yen]

Item Amount Item Amount

Assets Liabilities

Current assets 589,331 Current liabilities 285,220

Cash and deposits 95,490 Notes and account payable - trade 96,240

Notes and accounts receivable-trade 220,120 Short-term loans payable 37,078

Lease receivables and lease investment assets 21,211 Current portion of long-term loans payable 27,003

Securities 92,999 Accounts payable-other 39,824

Inventories 115,275 Accrued expenses 34,509

Deferred tax assets 18,806 Income taxes payable 5,652

Accounts receivable-other 14,636 Provision for bonuses 13,007

Other 16,435 Provision for directors’ bonuses 244

Allowance for doubtful accounts (5,643) Provision for product warranties 1,441

Notes payable-facilities 1,185

Asset retirement obligations 256

Other 28,776

Noncurrent assets 376,729 Noncurrent liabilities 200,785

Property, plant and equipment 173,362 Bonds payable 70,000

Buildings and structures, net 61,441 Long-term loans payable 62,042

Machinery, equipment and vehicles, net 23,542 Deferred tax liabilities for land revaluation 3,269

Tools, furniture and fixtures, net 27,058 Net defined benefit liability 53,563

Land 34,310 Provision for directors’ retirement benefits 237

Lease assets, net 521 Asset retirement obligations 1,012

Construction in progress 13,819 Other 10,658

Assets for rent, net 12,668 Total liabilities 486,005

Intangible assets 111,362 Net assets

Goodwill 65,734 Shareholder's equity 466,797

Other 45,627 Capital stock 37,519

Investments and other assets 92,003 Capital surplus 204,140

Investment securities 29,256 Retained earnings 242,460

Long-term loans receivable 83 Treasury stock (17,322)

Long-term prepaid expenses 3,230 Accumulated other comprehensive income 11,607

Deferred tax assets 48,040 Valuation difference on available-for-sale

securities 5,086

Other 12,277 Deferred gains or losses on hedges (38)

Allowance for doubtful accounts (883) Foreign currency translation adjustment 15,055

Remeasurements of defined benefit plans (8,497)

Subscription rights to shares 910

Minority interests 740

Total net assets 480,055

Total assets 966,060 Total liabilities and net assets 966,060

39

Consolidated Statement of Income (From April 1, 2013 to March 31, 2014) [Millions of yen]

Item Amount

Net sales 943,759

Cost of sales 492,269

Gross profit 451,490

Selling, general and administrative expenses 393,346

Operating income 58,144

Non-operating income

Interest and dividends income 2,122

Other 3,437 5,559

Non-operating expenses

Interest expenses 2,852

Share of loss of entities accounted for using equity method 1,163

Foreign exchange losses 126

Other 4,940 9,083

Ordinary income 54,621

Extraordinary income

Gain on sales of noncurrent assets 639

Gain on sales of investment securities 75

License related income 809 1,524

Extraordinary loss

Loss on sales and retirement of noncurrent assets 2,639

Loss on valuation of investment securities 49

Impairment loss 5,524

Business structure improvement expenses 3,532

Loss on business withdrawal 16,122

Group restructuring expenses 118

Special extra retirement payments 4,655 32,642

Income before income taxes and minority interests 23,503

Income taxes-current 11,624

Income taxes-deferred (10,060) 1,564

Income before minority interests 21,939

Minority interests in income 77

Net income 21,861

40

Consolidated Statement of Changes in Net Assets (From April 1, 2013 to March 31, 2014) [Millions of yen]

Shareholder’s Equity

Capital stock Capital surplus Retained earnings

Treasury stock Total shareholder’s

equity

Balance at April 1, 2013 37,519 204,140 229,713 (1,548) 469,825

Changes of items during period

Dividends of surplus (9,280) (9,280)

Net income 21,861 21,861

Change of scope of consolidation 176 176

Purchase of treasury stock (15,806) (15,806)

Disposal of treasury stock (11) 32 20

Net changes of items other than shareholders' equity

Total changes of items during period －－ 12,746 (15,774) (3,028)

Balance at March 31, 2014 37,519 204,140 242,460 (17,322) 466,797

Accumulated other comprehensive income

Subscription rights to shares

Minority interests

Total net assets

Valuation difference

on available-for-sale

securities

Deferred gains or losses on hedges

Foreign currency

translation adjustment

Remeasurements of defined

benefit plans

Total accumulated

other comprehensiv

e income

Balance at April 1, 2013 3,345 2 (8,268) － (4,920) 764 747 466,416


Dividends of surplus (9,280)

Net income 21,861

Change of scope of consolidation 176

Purchase of treasury stock (15,806)

Disposal of treasury stock 20

Net changes of items other than

shareholders' equity 1,741 (40) 23,324 (8,497) 16,527 145 (6) 16,666

Total changes of items during period 1,741 (40) 23,324 (8,497) 16,527 145 (6) 13,638

Balance at March 31, 2014 5,086 (38) 15,055 (8,497) 11,607 910 740 480,055

41

Notes to Consolidated Financial Statements

＜NOTES TO BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS＞

I．Scope of Consolidation

1. Number of consolidated subsidiaries and names of principal consolidated subsidiaries

Number of consolidated subsidiaries: 109 companies

Names of principal consolidated subsidiaries:

Konica Minolta Business Solutions Japan Co., Ltd. Konica Minolta Healthcare Co., Ltd. Konica Minolta Supplies Manufacturing Co., Ltd. Konica Minolta Technoproducts Co., Ltd. Konica Minolta Business Solutions U.S.A., Inc. Konica Minolta Business Solutions Europe GmbH Konica Minolta Business Solutions Deutschland GmbH Konica Minolta Business Solutions France S.A.S. Konica Minolta Business Solutions (UK) Ltd. Konica Minolta Business Solutions Australia Pty. Ltd. Konica Minolta Business Solutions (CHINA) Co., Ltd. Konica Minolta Business Technologies Manufacturing (HK) Ltd. Konica Minolta Business Technologies (WUXI) Co., Ltd. Konica Minolta Business Technologies (DONGGUAN) Co., Ltd. Konica Minolta Opto (DALIAN) Co., Ltd.

Changes in consolidated subsidiaries:

(Increased due to importance) Konica Minolta With You, Inc.

ECS Buero-und Datentechnik GmbH

Konica Minolta Business Solutions India Private Ltd.

(Increased due to purchase of shares or equity interest)

CopySource Inc.

KnowledgeCentrix Holdings, LLC.

(Increased due to foundation）

Konica Minolta Medical Products Co., Ltd.

(Decreased due to company liquidation)

RGI Süd GmbH

(Decreased due to merger)


Konica Minolta Advanced Layers, Inc.

Konica Minolta Optics, Inc.

Konica Minolta Medical & Graphic , Inc.

Konica Minolta IJ Technologies, Inc.

Konica Minolta Technology Center, Inc.

Konica Minolta Business Expert, Inc. R+M Business Software Neu-Ulm GmbH

2. Names of principal unconsolidated subsidiaries Konica Minolta Business Solutions (Thailand) Co., Ltd.

Unconsolidated subsidiaries have not been included in consolidation because they are relatively small and their

total assets, sales, net income and retained earnings (in proportion to scale of equity ownership), etc. do not

have a material impact on the consolidated financial statements.

II．Scope of the Use of Equity Accounting

1. Number of affiliated companies accounted for by the equity method and names of principal companies

Number of companies accounted for by the equity method:

2 companies

Principal companies accounted for by the equity method: Toho Chemical Laboratory Co., Ltd

2. Names of principal unconsolidated subsidiaries and affiliated companies that are not accounted for by the equity

method

42

Konica Minolta Business Solutions (Thailand) Co., Ltd. Companies that are not accounted for by the equity method are excluded from the scope of the equity method

because they have an insignificant effect on consolidated net income and consolidated retained earnings and

also lack overall materiality.

III．Changes Regarding Consolidated Subsidiaries during the Fiscal Year under Review

Some consolidated subsidiaries have fiscal years ending on December 31, and consolidated financial statements

are prepared using the financial statements of those companies as of that fiscal year-end date. Adjustments are

made to consolidated accounts to account for important transactions involving those companies that occur

between the end of those companies’ fiscal year-end date and the end of the consolidated fiscal year.

(Consolidated Subsidiaries with Fiscal Years Ending on December 31)

Konica Minolta Business Solutions do Brazil Ltda.

Konica Minolta Business Solutions de Mexico SA de CV.

Konica Minolta Business Solutions Russia LLC

Konica Minolta Medical Systems Russia LLC

Consolidated subsidiaries Konica Minolta Business Solutions (Shenzhen) Co., Ltd. and Konica Minolta Business

Solutions Romania s.r.l. end their fiscal years on December 31. In prior years, financial statements for this year

were used to prepare the fiscal year consolidated financial statements with consolidation adjustments as needed

for significant transactions between January 1 and March 31. To provide more suitable consolidated financial

information, starting with the fiscal year that ended in March 2014, the fiscal year ends of these two subsidiaries

were changed to March 31. Due to this change, the consolidated financial statements include 15 months of

operations of these two subsidiaries, covering the period from January 1, 2013 to March 31, 2014.

43

IV．Accounting Standards and Methods

1. Valuation Standards and Methods of Assets

(1) Securities

Held to maturity receivables

The amortized cost method (the straight-line method) is used.

Other securities

Securities with fair market value are stated using the mark-to-market method based on the market

price at the balance sheet date. (Total net unrealized gains or losses after tax effect adjustments are

directly recorded in shareholders' equity, and the cost of securities sold is computed based on the

moving-average method.)

Other securities that do not have fair market values are primarily stated at cost using the moving value

average.

(2) Derivatives

Derivatives are stated using the mark-to-market method.

(3) Inventories

Konica Minolta, Inc. (“the Company”) and its domestic consolidated subsidiaries’ inventories are, in the

main, recorded at cost as determined by the periodic-average method (method of reducing book value when

the contribution of inventories to profitability declines). Overseas consolidated subsidiaries' inventories are

recorded at the lower of cost or market value, with cost determined by the first-in, first-out method.

2. Amortization Method for Noncurrent Assets

(1) Property, plant and equipment (excluding lease assets)

The depreciable assets of the Company and its domestic consolidated subsidiaries are depreciated using the

declining-balance method. Overseas consolidated subsidiaries adopt the straight-line method. However, the

Company and its domestic consolidated subsidiaries have used the straight-line method for their buildings

(excluding annexed structures) acquired since April 1, 1998.

(2) Intangible assets (excluding lease assets)

We have adopted the straight-line method. The software for internal use applies the straight-line method

based on an estimated in-house working life of five years.

(3) Lease assets

Lease assets arising from finance lease transactions not involving transfer of ownership

Depreciation is computed using the straight-line method based on the assumption that the useful life equals

the lease term and the residual value equals zero. Finance lease transactions not involving transfer of

ownership commencing on or before March 31, 2008 are accounted for based on methods applicable to

ordinary rental transactions.

3. Standards for Allowances

(1) Allowance for doubtful accounts

To prepare for possible losses on uncollectable receivables, for general receivables, an amount is provided

according to the historical percentage of uncollectables. For specific receivables for which there is some

concern regarding collectability, an estimated amount is recorded by investigating the possibility of

collection for each individual account.

(2) Provision for bonuses To prepare for the payment of employee bonuses, an amount corresponding to the current portion of

estimated bonus payments to employees is recorded.

(3) Provision for directors’ bonuses

To prepare for the payment of directors’ and officers’ bonuses, an amount corresponding to the projected

value of bonus payments to directors and officers for the fiscal year under review is recorded.

(4) Provision for product warranties

The provisioning of free after-sales service for products is recorded based on past after-sales service

expenses as a percentage of net sales.

(5) Provision for directors’ retirement benefits

Consolidated subsidiaries, to provide for the payment of directors’ and officers’ retirement benefits, record

provision for benefits for retired directors and officers in an actual amount equal to the need at the end of

the fiscal year period under review based on the relevant rules and regulations on directors’ retirement

benefits.

4. Accounting method for retirement benefits

To prepare for the payment of retirement benefits to employees, liabilities for these benefits in an amount

equal to retirement benefit liabilities less pension plan assets is recognized based on the expected amount of

these benefits as of March 31, 2014.

44

Past service expenses are recognized as expenses using the straight-line method over a certain number of years

(mainly 10 years) that is not more than the average remaining years of service for employees when the

expenses occur.

Actuarial gains and losses are recognized as expenses starting in the fiscal year following the occurrence of

these gains and losses. The gains and losses are allocated to individual fiscal years by using the straight-line

method over a certain number of years (mainly 10 years) that is not more than the average remaining years of

service for employees in each fiscal year when the gains and losses occur.

Unrecognized past service expenses and unrecognized actuarial gains and losses are posted as an accumulated

adjustment for retirement payments in the accumulated other comprehensive income section of net assets,

after adjusting for the effect of taxes.

5. Accounting methods for hedge transactions

(1) Hedge accounting methods

The deferred hedge method is used. Special accounting methods are used for interest rate swaps that meet

certain conditions.

(2) Hedge methods and hedge targets

The hedge methods are forward exchange contracts, currency option transactions, currency swaps and

interest rate swaps.

The hedge targets are scheduled foreign currency denominated transactions and borrowings.

(3) Hedge policy

The Company and consolidated subsidiaries enter into forward foreign exchange contracts and currency

option transactions as hedging instruments only, not for trading purpose to make profits, within the limit of

actual foreign transactions to reduce risk arising from future fluctuations of foreign exchange rates.

In addition, the Company and consolidated subsidiaries enter into currency swaps and interest rate swaps to

make interest rates on borrowings stable and reduce costs fluctuations for future capital procurement, both

as hedging instruments only, not for speculation purpose, within the limit of actual financial or operating

transactions.

(4) Methods for evaluating the effectiveness of hedges

Verification is made to ascertain a high correlation between value fluctuations of cash flows and hedging

instruments.

6. Consumption tax

The tax-exclusion method is used to account for consumption taxes and local consumption taxes. In addition,

asset-related consumption tax that cannot be excluded is accounted for as deferred consumption taxes, etc., in

the long-term prepaid expenses item and amortized over a five-year period by the straight-line method.

7. Consolidated tax payment system

The consolidated tax payment system is applied.

8. Amortization of goodwill

Amortization of goodwill is carried out separately for each goodwill item over a rational time period of 20

years or less.

<Note concerning change in accounting method>

(Application of accounting standard for retirement benefits)

Starting with the fiscal year that ended in March 2014, Konica Minolta is using Accounting Standard for

Retirement Benefits (Accounting Standards Board of Japan (ASBJ) Statement No. 26, May 17, 2012) and

Guidance on Accounting Standard for Retirement Benefits (ASBJ Guidance No. 25, May 17, 2012). (However,

this excludes the main text of clause 35 of this accounting standard and clause 67 of this guidance.) As a result,

Konica Minolta has changed to the method of recording the amount remaining after deducting plan assets from

projected benefit obligations as retirement benefit liabilities. Unrecognized actuarial gains and losses and

unrecognized past service expenses are recognized as liabilities for retirement payments.

Due to the application of this accounting standard and guidance, based on the handling of retroactive adjustments

as prescribed in paragraph 37 of the retirement benefit accounting standard, the monetary effect of this change has

been incorporated in the accumulated adjustment for retirement payments in accumulated other comprehensive

income.

The result of this change was a net retirement benefit liability of ¥53,563 million as of March 31, 2014. In

addition, accumulated other comprehensive income decreased ¥8,497 million.

Information about the effect on per share data is provided in <Notes on Per-Share Information>.

45

<Notes to Consolidated Balance Sheet>

1. Assets used for collateral and Secured Obligations

(1) Assets used for collateral

Accounts Receivable-trade ¥12 million

Vehicles ¥3 million

(2) Secured Obligations

Short-term Loans payable ¥13 million

Long-term loans due within one year 0 million

Long-term loans 2 million

2. Accumulated depreciation on tangible noncurrent assets ¥470,778 million

3. Breakdown of inventories

Merchandise and Finished Goods ¥87,807million

Work in Process ¥9,609 million

Raw Materials and Stores ¥17,858 million

4. Balance of guaranteed obligations

Guaranteed obligations (guarantees for bank loans and lease obligations, etc. of unconsolidated companies,

etc.) ¥427 million

<Notes to Consolidated Statement of Changes in Shareholders’ Equity>

1. Issued Shares

Type of shares End of previous fiscal year Increase Decrease End of fiscal year under review

Common shares shares

531,664,337

shares

-

shares

-

shares

531,664,337

2. Treasury stock

Type of shares End of previous fiscal year Increase Decrease End of fiscal year under review

Common shares shares

1,346,048 shares

15,402,953 shares 28,313

shares 16,720,688

(Summary of reasons for change)

The principal reasons for increase were as follows:

Increase in treasury stock based on Board of Directors resolution 15,365,000 shares

Increase related to requests to purchase shares less than full trading units: 37,953shares Note: On January 30, 2014, the Board of Directors approved a resolution for the repurchase of stock in accordance with

Article 156 of the Company Law, which is applied pursuant to Article 165, Paragraph 3 of this act.

The principal reasons for decrease were as follows:

Reduction related to exercise of stock acquisition rights: 27,500 shares

Reduction related to shareholders’ buying to complete full trading units: 813shares

3. Dividends

(1) Dividends paid

Decision Type of shares Total dividend value

(millions of yen)

Dividend per share

(yen) Record date Effective date

Board of Directors

May 10, 2013 Common shares 3,977 7.50 March 31, 2013 May 27, 2013

Board of Directors

October 31, 2013 Common shares 5,303 10.00

September 30,

2013

November 27,

2013

Note: On October 31, 2013, the Board of Directors approved a resolution to pay an interim dividend of ¥10 per share,

which includes a ¥2.50 commemorative dividend.

(2) Dividends for the record date belonging to the current fiscal period but effective in the next fiscal period

Decision Type of

shares Total dividend value

(millions of yen)

Dividend

source

Dividend per

share (yen) Record date Effective date

Board of Directors

May 9,2014 Common shares 3,862

Retained

earnings 7.50 March 31, 2014 May 27, 2014

46

4. Stock subscription rights

Breakdown of stock subscription rights Type of shares under stock

subscription rights

Number of shares under stock

subscription rights

First issue of stock compensation-type stock

options for 2005 Common shares 75,000 shares

Second issue of stock compensation-type stock


Third issue of stock compensation-type stock


Fourth issue of stock compensation-type stock


Fifth issue of stock compensation-type stock


Sixth issue of stock compensation-type stock


Seventh issue of stock compensation-type stock


Eighth issue of stock compensation-type stock

options for 2012 Common shares 280,500shares

Ninth issue of stock compensation-type stock


Total 1,373,000 shares

<Notes to Financial Instruments>

1. Matters relating to the status of financial instruments

The Konica Minolta Group raises short-term working capital mainly with bank borrowings and invests temporary

surplus funds in financial instruments with extremely low risk. The Group has decided to engage in derivatives

transactions within the scope of actual demand in accordance with its internal regulations.

In principle, the risk of currency fluctuations relating to receivables and payables denominated in foreign

currencies are hedged using the forward exchange contract and currency option transactions. With respect to the

interest volatility risk relating to some loans payable and costs fluctuations risk for future capital procurement, we

try to fix interest expenses using the currency swaps and interest-rate swaps.

Investment securities consist mainly of stocks, and the market values of listed stocks are determined on a

quarterly basis.

We try to reduce the credit risk of customers relating to notes and accounts receivable-trade through regular

monitoring and the comprehensive management of deadlines and balances.

2. Matters relating to fair market values, etc. of financial instruments

The consolidated balance sheet amount, the fair market value and the difference between the two on March 31,

2014 (the closing date of the consolidated fiscal year under review) are as follows.

[Millions of yen]

Consolidated balance sheet amount Fair market value Difference

(1) Cash and deposits 95,490 95,490 － (2) Notes and accounts receivable-trade 220,120 220,120 － (3) Securities and investment securities

(i) Held-to-maturity receivables 10 10 － (ii) Other securities 119,127 119,127 － (4) Notes and accounts payable-trade (96,240) (96,240) － (5) Short-term loans payable (37,078) (37,078) － (6) Current portion of long-term loans payable (27,003) (27,008) (5) (7) Bonds payable (70,000) (71,040) (1,040) (8) Long-term loans payable (62,042) (60,918) 1,123 (9) Derivatives transactions (529) (529) － 1) Items that are posted in liabilities are enclosed in parentheses. 2) Net receivables and payables generated from derivatives trading are shown. Items generating net payables are enclosed in parentheses.

47

(Note 1) Methods of calculating the fair market value of financial instruments and matters relating to securities and

derivatives transactions

(1) Cash and deposits and (2) Notes and accounts receivable-trade

As they are settled in a short period and their market values are nearly identical to their book values, the book

values are used.

(3) Securities and investment securities

For the fair market values of securities and investment securities, the prices of stocks are based on the value on the

relevant stock exchanges and the prices of receivables are based on the value indicated by relationship financial

institutions.

(i) As held-to-maturity receivables are entirely school bonds and the creditworthiness of the issuers has not

changed materially from the time of acquisition, their book values are used.

(ii) The acquisition cost, consolidated balance sheet amount and difference between them of other securities

are as follows.

[Millions of yen]

Type Acquisition cost

Consolidated balance

sheet amount Difference

Consolidated balance sheet amount

exceeding the acquisition cost

Stocks 12,741 21,763 9,021

Others 10 20 9

Consolidated balance sheet amount

not exceeding the acquisition cost

Stocks 4,998 4,340 (658)

Receivables 6,000 5,999 (0)

Negotiable deposit 87,000 87,000 －

Others 5 4 (1)

Total 110,757 119,127 8,370 (4) Notes and accounts payable-trade, and (5) Short-term loans payable

As they are settled in a short period and their fair market values are nearly identical to their book values, the

book values are used.

(6) Current portion of long-term loans payable, and (8) Long-term loans payable

For the fair market values of long-term loans payable at fixed interest rates, the total amount of the principal and

interest is discounted using a rate that is assumed to be applied when a similar loan is newly borrowed.

For the fair market values of long-term loans payable at variable interest rates, as the credit risk of the Company

has not changed materially and the market values are nearly identical to their book values, the book values are

used.

(7) Bonds payable

The book value of corporate bonds is based on the value indicated by relationship financial institutions.

(9) Derivatives transactions

(i) Those which the hedge accounting does not apply to

The contract amount or the amount equivalent to the principal set forth in the contract for each type of

hedged item in derivatives transactions on the consolidated closing date, the fair market value and

valuation gains or losses, and the method of calculating fair market value are as follows:

(a) Currency-related derivatives [Millions of yen]

Category Type

Contract amount, etc. Fair market

value

Valuation

gains or losses More than

one year

Transactions other than

market transactions

Forward exchange contracts 20,965 － (170) (170)

Currency swap transactions 7,376 － (299) (299)

(Note) The fair market values of forward exchange contracts are calculated using forward exchange rates, and the fair market values

of currency swap transaction are calculated using prices offered by relationship financial institutions.

(ii) Those which the hedge accounting applies to

The contract amount or the amount equivalent to the principal set forth in the contract, etc. for each

method of hedge accounting on the consolidated closing date are as follows:

48

(a) Currency-related derivatives [Millions of yen]

Method of hedge

accounting

Type etc. of

derivatives

transactions

Major hedged items


value More than

one year

Fundamental

treatment method

Forward exchange

contracts

Accounts receivable-

trade 9,660 - (51)

Currency option

transactions

Long put・Short

call

Accounts receivable-

trade 1,278 - (7)

Designated

accounting for

currency swaps

Currency swap

transactions Long-term loans payable 4,450 4,450 （＊）

(Note) 1. The fair market values of forward exchange contracts are calculated using forward exchange rates, and the fair market values of currency swap transaction are calculated using prices offered by relationship financial institutions.

2. Aggregate currency option transactions are shown because they are zero-cost options and puts and calls are unified contracts.

(＊) When deferral hedge accounting is used for currency swaps, this treatment is used collectively with long-term loans

subject to the hedges. As a result, fair value includes the fair value of the applicable long-term loans (see (8) above).

(b) Interest rate related derivatives [Millions of yen]

Method of hedge

accounting

Type etc. of

derivatives

transactions

Major hedged items


value More than

one year

Specified hedge

accounting of

interest rate swap

Interest rate swap

transactions long-term loans payable 22,450 22,450 （＊）

(＊) As interest rate swaps subject to the special treatment of interest rate swap are accounted for as a single item

with underlying long-term loans, which are hedged items, their market values are included in those of long-

term loans (see (8) above).

(Note 2)

As unlisted stocks (consolidated balance sheet amount of ¥ 1,049 million) and shares of affiliates (consolidated

balance sheet amount ¥ 2,067 million) do not have market values, it is considered extremely difficult to calculate

their fair market values. Therefore, they are not included in “(3) (ii) Other securities.”

<Notes to Real Estates for Rent, etc.>

1. Matters regarding the status of real estates for rent, etc.

The Company and some consolidated subsidiaries have office buildings for rent and idle assets, etc. in Japan and

overseas.

2. Matters regarding fair market values, etc. of real estates for rent, etc.

[Millions of yen]

Consolidated balance sheet amount Fair market value as of the end of the

fiscal year under review

4,944 6,234

(Note 1) Consolidated balance sheet amount is calculated by subtracting accumulated depreciation and accumulated

impairment losses from acquisition cost.

(Note 2) Fair market value as of the end of the fiscal year under review is recorded as follows:

(1) Amount of primary domestic real estates has been calculated by the Company based on the method similar

to real-estate appraisal standards. However, if changes in a performance indicator that is believed to

properly reflect the market price have been insignificant, such domestic real estate have been evaluated by

real-estate appraisal at the immediate appraisal. Other domestic real estates have been calculated based on

a certain appraisal or the criteria which seems to reflect the fair market value correctly.

(2) Overseas real estates have been primarily calculated by real-estate appraisal by local appraisers.

49

<Notes on Per-Share Information>

1. Net assets per share ¥929.04

2. EPS ¥41.38 Note: As is explained in <Note concerning change in accounting method>, the retirement benefit accounting method is applied

and the transitional treatment prescribed in paragraph 37 of the retirement benefit accounting standard is used. As a result of this

change, net assets per share decreased ¥16.50 in the fiscal year.

<Significant Subsequent Events> None

<Other Notes>

1. The primary component of the asset impairment loss is a ¥3,566 million loss on buildings, etc. located in the cities of Hino

and Kofu. The loss is due to the termination of internal film production in the Healthcare Business, which resulted in the

write-down of the net sales price of idle assets to a memorandum value because of the difficulty of calculating a sales

price. The asset impairment loss due to termination of production of HDD glass substrates is included in the business

termination loss in the consolidated profit and loss statement. 2. Business structural improvement expenses are mainly for structural reforms at European and North American sales bases

of the Business Technologies Business, a review of manufacturing operations for cell phone lens units in the Industrial

Business, and the termination of internal film production in the Healthcare Business. 3. The business termination loss is a loss resulting from stopping manufacturing HDD glass substrates in the Industrial

Business. This loss includes an ¥11,899 million asset impairment loss, a loss on the disposal of inventories and other

items. The asset impairment loss consists of the following items.

Use Type Place Price

Manufacturing facilities

for HDD glass substrates

and others

Machinery, buildings

and others

Malaysia, Itami City (Hyogo

prefecture), Iruma City (Saitama

prefecture) and others 11,899 million yen

(*)Asset impairment loss: Machinery, equipment and vehicles ¥6,113 million; buildings and structures ¥5,192 million;

tools, furniture and fixtures ¥593 million (1) Method for asset grouping

Assets are grouped according to product categories and locations of business sites.

(2) Reason for recognition of asset impairment loss

Due to the decision to terminate the production of HDD glass substrates, the book value of the assets in this group

was written down to the amount that can be recovered and the resulting reduction was included in the loss on

termination of a business.

(3) Method for calculating amount that can be recovered

The amount that can be recovered for the HDD glass substrate asset group was determined by using the net sales

price. These assessments used the real estate appraisal standard price for buildings, etc. and reasonable estimates for

other assets. 4. Special extra retirement payments are additional payments to individuals who receive additional benefits by participating

in the early retirement program. 5. Group reorganization expenses are expenses associated with the reorganization of the group’s management structure on

April 1, 2013. 6. The item concerning business combinations, etc. is as follows.

(Reorganization of the group’s management structure)

On April 1, 2013, Konica Minolta merged with Konica Minolta Business Technologies, Inc. and six other group

companies. I. Purpose of business combination

The purpose of the reorganization of the group’s management structure is to raise the speed of measures for increasing

corporate value. Goals are to strengthen innovative management capabilities in the Business Technologies Business, utilize

group resources in a strategic and agile manner, and establish frameworks for more efficient business operations. II. Scheme for the business combination

1. Merger method

This was an absorption-type merger in which Konica Minolta was the surviving company. The other seven group

companies were terminated.

2. Allotment of shares and other items concerning the merger

No shares, cash or other assets were allotted in relation to the merger because Konica Minolta held all shares of the seven

companies that were involved in this merger.

50

III. Summary of companies merged (Year ended March 31, 2014, non-consolidated)

(1) Trade name Konica Minolta Business Technologies, Inc. Konica Minolta Advanced Layers, Inc.

(2) Description

of businesses

Manufacturing and sale of multi-functional

peripherals (MFPs), printers, and equipment

for production print systems and graphic arts,

providing related solution services

Manufacturing and sale of electronic materials

(TAC films etc.), lighting source panels, and

performance materials (including heat

insulation films)

(3) Capital ¥400 million ¥400 million

(4) Net assets ¥140,744 million ¥37,922 million

(5) Total assets ¥203,548 million ¥62,257 million

(1) Trade name Konica Minolta Optics, Inc. Konica Minolta Medical & Graphic, Inc.

(2) Description

of businesses

Manufacturing and sale of optical products

(including pickup lenses) and measuring

instruments for industrial and healthcare

applications

Manufacturing and sale of consumables and

equipment for healthcare systems

(3) Capital ¥400 million ¥400 million

(4) Net assets ¥11,207 million ¥21,726 million

(5) Total assets ¥51,430 million ¥47,653 million

(1) Trade name Konica Minolta

IJ Technologies, Inc.

Konica Minolta Technology

Center, Inc.

Konica Minolta Business Expert,

Inc.

(2) Description

of businesses

Manufacturing and sale of

inkjet printheads, inks and

textile printers for industrial

use

Provision of services to group

companies including R&D,

customized product design and

management of intellectual

property assets

Provision of various shared

services for the Group in the

field of engineering,

environment, safety and others

(3) Capital ¥10 million ¥50 million ¥495 million

(4) Net assets ¥5,582 million ¥2,895 million ¥6,683 million

(5) Total assets ¥9,329 million ¥9,161 million ¥9,498 million

IV. Status after the Merger

1. Trade name: Konica Minolta, Inc.

2. Location of head office: 2-7-2 Marunouchi, Chiyoda-ku, Tokyo

3. Title and name of representative: Masatoshi Matsuzaki, Representative Executive Officer and President

(Shoei Yamana was named president and representative executive officer on April 1, 2014.)

4. Description of businesses

・Development, manufacture, and sales of products including MFPs, printers, equipment for production printing

systems, equipment for healthcare systems, measuring instruments for industrial and healthcare applications,

inkjet printheads and textile printers for industrial use, and providing related consumables and solution

services, etc.

・Development, manufacture, and sales, etc. of electronic materials (TAC films, etc.), lighting source panels,

functional films (heat insulation films, etc.), and optical products (lens units, etc.)

5. Capital: ¥37,519 million

V. Summary of accounting treatment This merger was a common control transaction in accordance with Accounting Standards for Business

Combinations (ASBJ Statement No. 21, December 26, 2008) and Revised Guidance on Accounting Standard for

Business Combinations (ASBJ Guidance No. 10, December 26, 2008).

51

7. Revisions of deferred tax assets and liabilities due to change in corporate income tax rate, etc.

The Act to Partially Amend the Income Tax Act (Law No. 10 of 2014) was announced on March 31, 2014

and ends the special corporate tax for reconstruction beginning with fiscal years that start on April 1, 2014

and afterward. In addition, the Local Corporate Tax Act (Law No. 11 of 2014) was announced on March 31,

2014. This act lowers the corporate residents tax rate and establishes the local corporate tax in an amount

equal to this reduction beginning with fiscal years that start on or after October 1, 2014. Due to these two

new laws, the statutory tax rate used to calculate deferred tax assets and liabilities has been lowered from

38.01% to 35.64% for temporary differences that are expected to settle in fiscal years starting on or after

April 1, 2014. For temporary differences that are expected to settle in fiscal years that start on or after

October 1, 2014, the corporate tax portion has been increased from 23.71% to 24.75% and the residents tax

portion has been lowered from 4.91% to 3.86%. These changes reduced net deferred tax assets (deferred tax

assets minus deferred tax liabilities) by ¥2,139 million and deferred gains or losses on hedges by ¥1 million

and as of March 31, 2014 and increased deferred income taxes by ¥2,137 million yen in the fiscal year that

ended in March 2014.

8. Figures given in the text have been rounded down to the nearest million.

52

Independent Auditor’s Report

May 8, 2014 The Board of Directors Konica Minolta, Inc.

KPMG AZSA LLC

Yoshihiko Nakamura (Seal)

Designated Limited Liability Partner

Engagement Partner

Certified Public Accountant

Hiroo Iwaide (Seal)


Engagement Partner


Shinji Someha (Seal)


Engagement Partner


We have audited the consolidated financial statements, comprising the consolidated balance sheet, the consolidated statement of income, the consolidated statement of changes in shareholder’s equity and the notes to consolidated financial statements of Konica Minolta, Inc. (“the Company”) as at March 31, 2014 and for the year from April 1, 2013 to March 31, 2014 in accordance with Article 444 (4) of the Company Law. Management’s Responsibility for the Consolidated Financial Statements Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with accounting principles generally accepted in Japan, and for the establishment and operation of such internal control as management determines is necessary to enable the preparation and fair presentation of consolidated financial statements that are free from material misstatements, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on the consolidated financial statements based on our audit as independent auditor. We conducted our audit in accordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The procedures selected and applied depend on our judgement, including the assessment of the risks of material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation and fair presentation

53

of the consolidated financial statements in order to design audit procedures that are appropriate in the circumstances, while the objective of the financial statement audit is not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position and the results of operations of the Company and its consolidated subsidiaries for the period, for which the consolidated financial statements were prepared, in accordance with accounting principles generally accepted in Japan. Other Matter Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan.

Notes to the Reader of Independent Auditor’s Report:

The Independent Auditor’s Report herein is the English translation of the Independent Auditor’s

Report as required by the Company Law

54

Balance Sheet (As of March 31, 2014) [Millions of yen]

Item Amount Item Amount

Assets Liabilities

Current assets

Cash and deposits

Notes receivable – trade

Accounts receivable – trade

Securities

Inventories

Prepaid expenses

Deferred tax assets

Short-term loans receivable

Accounts receivable – other

Income taxes refund receivable

Other

Allowance for debt accounts

Noncurrent assets

Property, plant and equipment

Buildings, net

Structures, net

Machinery and equipment, net

Vehicles, net

Tools, furniture and fixtures, net

Land

Lease assets, net

Construction in progress

Intangible assets

Software

Other

Investments and other assets

Investment securities

Stock of affiliated companies

Investments-affiliated companies

Long-term prepaid expenses

Deferred tax assets

Other

Allowance for doubtful accounts

334,559

44,405

3,347

90,597

92,999

36,588

1,744

11,337

55,435

6,609

1,516

3,044

(13,066)

345,120

100,973

35,608

1,972

11,393

28

8,482

31,181

376

11,928

13,833

9,673

4,159

230,313

26,140

97,927

75,321

2,544

25,053

3,384

(58)

Current liabilities

Notes payable

Accounts payable – trade

Short-term loans payable

Current portion of long-term loans payable

Lease obligations

Unpaid expenses

Accrued expenses

Income taxes payable

Advances received

Provision for bonuses

Provision for directors’ bonuses

Provision for product warranties

Other

Noncurrent liabilities

Bonds payable

Long-term loans payable

Lease obligations

Deferred tax liabilities for land revaluation

Provision for retirement benefits

Asset retirement obligations

Other

159,984

6,812

46,508

34,721

27,001

159

26,182

8,459

998

557

6,511

211

195

1,666

155,521

70,000

58,952

241

4,555

20,246

984

540

Total liabilities 315,506

Net assets

Shareholder's equity

Capital stock

Capital surplus

Capital reserve

Retained earnings

Other retained earnings

Retained earnings carried forward

Treasury stock

Valuation and translation adjustments

Valuation difference on available-for-sale

securities


Land revaluation difference


349,430

37,519

135,592

135,592

193,641

193,641

193,641

(17,322)

13,832

5,654

(38)

8,216

910

Total net assets 364,173

Total assets 679,679 Total liabilities and shareholders’ equity 679,679

55

Statement of Income (From April 1, 2013 to March 31, 2014) [Millions of yen]

Item Amount

Net sales 472,449

Cost of sales 294,572

Gross profit 177,876

Selling, general and administrative expenses 143,331

Operating income 34,545

Non-operating income

Interest and dividends income 6,667

Foreign exchange gains 1,268

Miscellaneous income 2,170 10,106

Non-operating expenses

Interest expenses 1,644

Miscellaneous expense 2,859 4,503

Ordinary income 40,148

Extraordinary income

Gain on sales of non-current assets 300

Gain on sales of investment securities 69

License related income 809

Gain on extinguishment of tie-in shares 115,046 116,225

Extraordinary loss

Loss on sales and retirement of noncurrent assets 1,150

Loss on valuation of investment securities 48

Loss on valuation of shares of subsidiaries and

associates 8,561

Provision of allowance for doubtful accounts 11,460

Impairment loss 4,748

Business structure improvement expenses 1,205

Loss on business withdrawal 2,226

Group restructuring expenses 118

Special extra retirement payments 3,018 32,538

Net income before taxes 123,836

Income taxes-current 115

Income taxes-deferred (12,998) (12,883)

Net income 136,719

56

Statement of Changes in Net Assets (From April 1, 2013 to March 31, 2014) [Millions of yen]

Shareholder’s equity

Capital stock

Additional paid-in capital Retained earnings

Treasury stock

Total shareholder

’s equity Capital reserve

Other Capital surplus

Total Additional

paid-in capital

Other retained earnings Total

retained earnings

Retained earnings carried forward

Balance at April 1, 2013 37,519 135,592 － 135,592 66,457 66,457 (1,548) 238,021


Dividends of surplus (9,280) (9,280) (9,280)

Net income 136,719 136,719 136,719

Purchase of treasury stock (15,806) (15,806)

Disposal of treasury stock (11) (11) 32 20

Reversal of revaluation reserve for land (243) (243) (243)


Total changes of items during period －－－－ 127,183 127,183 (15,774) 111,409

Balance at March 31, 2014 37,519 135,592 － 135,592 193,641 193,641 (17,322) 349,430

Valuation and translation adjustments


Total net assets

Valuation difference on

available-for-sale securities


Land revaluation difference

Total valuation and translation

adjustments

Balance at April 1, 2013 3,789 (61) 7,972 11,701 764 250,487


Dividends of surplus (9,280)

Net income 136,719

Purchase of treasury stock (15,806)

Disposal of treasury stock 20

Reversal of revaluation reserve for land 243 243 －


1,865 23 － 1,888 145 2,033

Total changes of items during period 1,865 23 243 2,131 145 113,686

Balance at March 31, 2014 5,654 (38) 8,216 13,832 910 364,173

57

Notes to Financial Statements

<Summary of Significant Accounting Policies>

1. Criteria and methods for evaluating securities

(1) Shares of subsidiaries and affiliates

Shares of subsidiaries and affiliates are stated at cost using the moving-average method.

(2) Other securities

Securities with fair market value are stated using the mark-to-market method based on the market price at the

balance sheet date. (Total net unrealized gains or losses after tax effect adjustment are directly recorded in

shareholders' equity, and the cost of securities sold is computed based on the moving-average method.)

Other securities that do not have fair market value are primarily stated at cost using the moving-value

average.

2. Criteria and methods for evaluating derivatives

Derivatives are stated using the mark-to-market method.

3. Inventory valuation standard and method

The value of inventories is determined by using the cost method based on the gross-average method (book

values are reduced to reflect declines in profitability).

4. Depreciation and amortization of noncurrent assets

(1) Property, plant and equipment (excluding lease assets)

The declining-balance method is used. However, the straight-line method is used for buildings (excluding

annexed structures) acquired since April 1, 1998.

(2) Intangible assets

The straight-line method is used. For software for internal use, the straight-line method is adopted based on a

licensing period of five years.

(3) Lease assets

Lease assets arising from finance lease transactions not involving transfer of ownership

Depreciation is computed using the straight-line method based on the assumption that the useful life equals

the lease term and the residual value equals zero. Finance lease transactions not involving transfer of

ownership commencing on or before March 31, 2008 are accounted for based on methods applicable to

ordinary rental transactions.

5. Standards for Allowances

(1) Allowance for doubtful accounts

To prepare for possible losses on uncollectable receivables, for general receivables, an amount is provided

according to the historical percentage of uncollectables. For specific receivables for which there is some

concern regarding collectability, an estimated amount is recorded by investigating the possibility of collection

for each individual account.

(2) Provision for bonuses

To prepare for the payment of employee bonuses, an amount corresponding to the current portion of

estimated bonus payments to employees is recorded.

(3) Provision for directors’ bonuses

To prepare for the payment of directors’ and officers’ bonuses, an amount corresponding to the projected

value of bonus payments to directors and officers for the fiscal year under review is recorded.

(4) Provision for product warranties The provisioning of free after-sales service for products is recorded based on past after-sales service expenses

as a percentage of net sales.

(5)Provision for retirement benefits

In order to provide employee retirement benefits, the amount recorded by the Company is based on projected

benefit obligations and pension assets at the end of the fiscal year.

Prior service cost is being amortized as incurred by the straight-line method over periods (10 years) which are

shorter than the average remaining years of service of the employees.

Actuarial gains and losses are amortized in the year following the year in which the gains or losses are

recognized, primarily by the straight-line method over periods (10 years) which are shorter than the average

remaining years of service of the employees.

The accounting method for undisposed unrecognized past service expenses and unrecognized actuarial gains

and losses is different from the accounting method used for the consolidated financial statements.

58

6. Accounting methods for hedge transactions

(1) Hedge accounting methods

The deferred hedge method is mainly used. Deferral hedge accounting is used for currency swaps that meet

the conditions, and special accounting methods are used for interest rate swaps that meet certain conditions,

respectively.

(2) Hedging methods and hedging targets

The hedge methods are forward exchange contracts, currency option transactions, currency swaps and interest

rate swaps are used as the hedge method.

The hedge targets are scheduled foreign currency denominated transactions, loans and borrowings.

(3) Hedge policy

The Company and consolidated subsidiaries enter into forward foreign exchange contracts and currency

option transactions as hedging instruments only, not for trading purpose to make profits, within the limit of

actual foreign transactions to reduce risk arising from future fluctuations of foreign exchange rates.

In addition, the Company and consolidated subsidiaries enter into currency swaps and interest rate swaps to

make interest rates on borrowings stable, to reduce the risk of cost fluctuations for future capital procurement,

or to make interest income from loans stable, not for speculation purpose, within the limit of actual financial

or operating transactions.

(4) Methods for evaluating the effectiveness of hedges

Verification is made to ascertain a high correlation between value fluctuations of hedged items, cash flows

and hedge instruments.

7. Consumption tax

The tax-exclusion method is used to account for consumption taxes and local consumption taxes. In addition,

asset-related consumption tax that cannot be excluded is accounted for as deferred consumption taxes, etc., in

the long-term prepaid expenses item and amortized over a five-year period by the straight-line method.

8. Consolidated tax payment system

Consolidated tax payment system is adopted.

(Additional information) The Company merged with seven group companies on April 1, 2013 and changed from a pure holding

company to an operating company. Due to this change, there are significant differences in the financial

condition and results of operations between the fiscal years that ended in March 2013 and March 2014.

<Notes to Balance Sheet>

1. Accumulated depreciation of tangible noncurrent assets ¥327,560 million

2. Receivables from affiliated companies and payables to affiliated companies

Short-term receivables ¥121,538 million

Short-term payables ¥70,985 million

Long-term payables ¥3 million

3. Comprehensive income attributable to inventories

Merchandise and finished goods ¥20,207 million

Work in process ¥10,507 million

Raw materials and supplies ¥5,874 million

4. Land revaluation

Land for industrial purposes that had been revaluated based on the Law Concerning Land Revaluation (Law No.

34 implemented on March 31, 1998) was received from Minolta Co., Ltd. on October 1, 2003, at the time of the

merger. The amount corresponding to taxes on the amount of the land revaluation is included under the item

deferred tax liabilities for land revaluation. An amount equivalent to the amount of the revaluation less the

deferred tax liability has been entered in shareholders’ equity as the land revaluation difference.

(1) Method of revaluation

The value of the land has been evaluated according to the value appraisal method for land fronting major

roads, as provided for in Article 2−4 of the Enforcement Orders for the Law Concerning Land Revaluation

(Enforcement Orders No. 119, implemented on March 31, 1998) and the method for valuation of noncurrent

assets provided for in Article 2−3 of the Enforcement Orders.

(2) Date of revaluation March 31, 2002

(3) The difference between the market value of the revalued land at the end of the fiscal year under review and the

book value following revaluation ¥(8,041 million)

59

5. Loan commitment

The Company has loan agreements with subsidiaries concerning financial matters for group companies and has

established credit lines for 10 of these subsidiaries. The available loan balance at the end of the fiscal year under

review under these agreements is as follows.

Total loan limit ¥76,318 million

Disbursed loan balance ¥55,242 million

Available loan balance ¥21,075 million

6. Pension assets in retirement benefit trust

The Company operates with two types of retirement benefit plans: a lump-sum payment plan and a defined

benefit pension plan.

Provision for retirement benefits and pension assets in retirement benefit trust at year end by retirement benefit

plan are as follows.

[Millions of yen]

Provision for retirement

benefits (before deduction of pension

assets in retirement benefit trust)

Pension assets in

retirement benefit trust

Provision for retirement

benefits (After deduction of pension

assets in retirement benefit trust)

Lump-sum payment

plan 9,427 － 9,427

Defined benefit

pension plan 19,076 8,257 10,818

Total 28,503 8,257 20,246

<Notes to Statement of Income>

Transactions with affiliated companies

Operating revenue ¥317,536 million

Operating expense ¥235,515 million

Other operating transactions ¥17,610 million

Other non-operating transactions ¥7,442 million

<Notes to Statement of Changes in Shareholders’ Equity>

Type and number of treasury stock at end of period

Common shares 16,720,688 shares

(Additional information)

On January 30, 2014, the Board of Directors of the Company approved a resolution to authorize the repurchase of stock as

prescribed in Article 156 of the Company Law as applied pursuant to Article 165, Paragraph 3 of this act, and repurchased

stocks accordingly.

60

<Notes on Tax Effect Accounting>

1. Breakdown by cause of deferred tax assets and liabilities

Deferred tax assets

Net operating tax loss carried forward ¥23,443 million Loss on valuation of shares of subsidiaries and associates ¥18,122 million Net defined benefit liability ¥13,386 million Allowance for doubtful accounts ¥4,786 million Excess of depreciation and amortization over deductible limit ¥2,495 million Provision for bonuses ¥2,320 million Loss on valuation ¥1,374 million

Other ¥5,782 million Deferred tax assets subtotal ¥71,712 million Valuation allowance ¥ (28,770) million Total deferred tax assets ¥ 42,942 million

Deferred tax liabilities

Revaluation difference of marketable securities ¥(2,682) million

Gain on establishment of employee pension trust ¥(2,010) million

Loss (gain) on transfer of business ¥(1,611) million

Other ¥(246) million

Total deferred tax liabilities ¥(6,551) million

Net deferred tax assets ¥36,391 million

2. Deferred tax liabilities related to revaluation

Deferred tax liabilities related to revaluation of land ¥(4,555 million)

3. Revisions of deferred tax assets and liabilities due to change in corporate income tax rate, etc.

The Act to Partially Amend the Income Tax Act (Law No. 10 of 2014) was announced on March 31, 2014 and

ends the special corporate tax for reconstruction beginning with fiscal years that start on April 1, 2014 and

afterward. In addition, the Local Corporate Tax Act (Law No. 11 of 2014) was announced on March 31, 2014.

This act lowers the corporate residents tax rate and establishes the local corporate tax in an amount equal to

this reduction beginning with fiscal years that start on or after October 1, 2014. In conformation with these

two new laws, the statutory tax rate used to calculate deferred tax assets and liabilities has been lowered from

38.01% to 35.64% for temporary differences that are expected to be amortized in fiscal years starting on or

after April 1, 2014. For temporary differences that are expected to be amortized in fiscal years that start on or

after October 1, 2014, the corporate tax portion has been increased from 23.71% to 24.75% and the residents

tax portion has been lowered from 4.91% to 3.86%. These changes reduced net deferred tax assets (deferred

tax assets minus deferred tax liabilities) by ¥1,844 million and deferred gains or losses on hedges by ¥1

million and as of March 31, 2014 and increased deferred income taxes by ¥1,843 million yen in the fiscal

year that ended in March 2014.

<Notes on Leased Noncurrent Assets>

In addition to the noncurrent assets recorded on the balance sheet, the Company has other significant

noncurrent assets which it uses under lease contracts, notably computer equipment. Finance lease

transactions not involving transfer of ownership commencing on or before March 31, 2008 are accounted

for based on methods applicable to ordinary rental transactions.

61

<Notes on Related-Party Transactions>

Subsidiaries, etc.

[Millions of yen]

Attribute Name of

company, etc.

Equity

ownership

percentage

Relationship with the Company Description

of transactions Transaction

amount Account

item Ending balance Executive posts

concurrently held Business relationship

Subsidiary

Konica

Minolta

Holdings

U. S. A.,

Inc.

(Ownership)

Direct

100％

One

Executive of

the

Company

U.S. holding company

Lending of

funds

(See Note 1.)

16,966 Short-

term loans 16,467

Subsidiary

Konica

Minolta

Business

Solutions,

Inc.

(Ownership)

Direct

100％

―

Sale of multi-

functional

peripherals

(MFPs), printers,

equipment for

production print

systems and

graphic arts, and

related supplies in

Japan, and

providing related

solution services

Sales of

products

(See Note 2)

33,814

Accounts

receivable

-trade

12,907

Subsidiary

Konica

Minolta

Business

Solutions

Europe

GmbH

(Ownership)

Direct

100％

One

Executive of

the

Company

Sale of multi-

functional

peripherals

(MFPs), printers,

equipment for

production print

systems and

graphic arts, and

related supplies in

Europe, and

providing related

solution services

Lending of

funds

(See Note 1.)

58 Short-

term loans 21,300

Sales of

products

(See Note 2)

113,634

Accounts

receivable

-trade

13,570

Subsidiary

Konica

Minolta

Business

Solutions

U.S.A., Inc.

(Ownership)

Indirect

100％

One

Executive of

the

Company

Sale of multi-

functional

peripherals (MFPs),

printers, equipment

for production print

systems and graphic

arts, and related

supplies in U.S.A.,

and providing

related solution

services

Sales of

products

(See Note 2)

83,084

Accounts

receivable

-trade

11,069

Subsidiary

Konica

Minolta

Business

Technologies

Manufacturin

g (HK) Ltd.

(Ownership)

Direct

100％

―

Manufacturing and

sale of multi-

functional

peripherals (MFPs),

printers and supplies

for those

Purchases of

products

(See Note 2)

47,740

Accounts

payable-

trade

9,426

Subsidiary

Konica

Minolta

Business

Technologies

(WUXI) Co.,

Ltd.

(Ownership)

Direct

15％

Indirect

85％

―

Manufacturing and

sale of multi-

functional

peripherals (MFPs),


for those

Purchases of

products

(See Note 2)

74,672

Accounts

payable-

trade

8,033

Subsidiary

Konica

Minolta

Business

Technologies

(DONGGUA

N) Co., Ltd.

(Ownership)

Indirect

100％

―

Manufacturing and

sale of multi-

functional

peripherals (MFPs),


for those

Purchases of

products

(See Note 2) 49,151

Accounts

payable-

trade

8,655

62

Subsidiary

Konica

Minolta

Glass Tech

Malaysia Sdn.

Bhd.

(Ownership)

Direct

100％

― ―

(See Note 3)

Lending of

funds

(See Note 3)

6,063 Short-

term loans 14,533

The transaction amount does not include consumptions tax. The ending-balance of Accrued income and Unpaid expenses

includes consumption tax.

(Notes) Transaction terms and policy for determining transaction terms

1. Regarding the lending of funds, the Company enters into loan agreements concerning group financing with

subsidiaries, setting a limit. The interest rate is determined based on market rates.

The transaction amount is the average loan balance over the period under review.

2. Terms for purchases and sales of products and other items are determined by price negotiations in each fiscal

year that take into account market prices and the cost of sales.

3. In association with the shutdown of the HDD glass substrate business, Konica Minolta Glass Tech Malaysia Sdn.

Bhd. will be dissolved and this company is no longer obligated to pay interest on loans. Furthermore, an addition

of ¥10,899 million has been made to the allowance for doubtful accounts for the amount of Konica Minolta

Glass Tech Malaysia receivables that the Company does not expect to collect. An addition of ¥10,899 million

was made to the allowance for doubtful accounts in the fiscal year that ended on March 31, 2014.

<Notes on Per Share Information>

Net assets per share ¥705.44

Net income per share ¥258.81

<Note concerning significant subsequent event >

None

<Other Notes>

1. The loss on valuation of shares of subsidiaries and associates mainly represents the write-down of stock of

Konica Minolta Glass Tech Malaysia in association with shutting down the HDD glass substrate business in

the Industrial Business and Business Technologies Business.

2. The provision of the allowance for doubtful accounts was mainly for ¥10,899 million receivable from

Konica Minolta Glass Tech Malaysia Sdn. Bhd. that is not expected to be repaid.

3. The primary component of the impairment loss is a ¥3,566 million loss on buildings, etc. located in the

cities of Hino and Kofu. The loss is due to the termination of internal film production in the Healthcare

Business, which resulted in the write-down of the net sales price of idle assets to a memorandum value

because of the difficulty of calculating a sales price.

4. Business structural improvement expenses are mainly for a review of manufacturing operations for cell

phone lens units in the Industrial Business, and the termination of internal film production in the Healthcare

Business.

5. The loss on business withdrawal is a loss resulting from shutting down manufacturing HDD glass substrates

in the Industrial Business. This loss includes an asset impairment loss of 462 million yen, a loss on the

disposal of inventories and other items.

6. Special extra retirement payments are additional payments to individuals who receive additional benefits by

participating in the early retirement program.

7. Group restructuring expenses are expenses associated with the reorganization of the group’s management

structure on April 1, 2013

8. Items concerning business combinations are as follows.

(Reorganization of the group’s management structure)

On April 1, 2013, the Company merged with Konica Minolta Business Technologies, Inc. and six other

group companies.

On April 1, 2013, the Company posted an extraordinary gain (gain on cancellation of shares due to

absorption of subsidiaries) of ¥115,046 million, which is the difference between assets and liabilities

received from the seven merged companies that were subsequently dissolved and the aggregate book values

of the stock of these subsidiaries. This extraordinary gain (gain on cancellation of shares due to absorption

of subsidiaries) includes a loss on cancellation of shares of subsidiaries of ¥2,656 million.

63

Please see the corresponding item of the notes to consolidated financial statements for more information

about the purpose of the business combination, a summary and other details. 9. Figures given in the text have been rounded down to the nearest million.

64

Independent Auditor’s Report

May 8, 2014 The Board of Directors Konica Minolta, Inc.

KPMG AZSA LLC

Yoshihiko Nakamura (Seal)


Engagement Partner


Hiroo Iwaide (Seal)


Engagement Partner


Shinji Someha (Seal)


Engagement Partner


We have audited the financial statements, comprising the balance sheet, the statement of income, the statement of changes in shareholder’s equity and the notes to financial statements, and the supporting schedules of Konica Minolta, Inc. (“the Company”) as at March 31, 2014 and for the 110th business year from April 1, 2013 to March 31, 2014 in accordance with Article 436 (2) (i) of the Company Law. Management’s Responsibility for the Financial Statements and Others Management is responsible for the preparation and fair presentation of the financial statements and the supporting schedules in accordance with accounting principles generally accepted in Japan, and for the establishment and operation of such internal control as management determines is necessary to enable the preparation and fair presentation of financial statements and the supporting schedules that are free from material misstatements, whether due to fraud or error. Auditor’s Responsibility Our responsibility is to express an opinion on the financial statements and the supporting schedules based on our audit as independent auditor. We conducted our audit in accordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and the supporting schedules are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements and the supporting schedules. The procedures selected and applied depend on our judgement, including the assessment of the risks of material misstatement of the financial statements and the supporting schedules, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation

65

and fair presentation of the financial statements and the supporting schedules in order to design audit procedures that are appropriate in the circumstances, while the objective of the financial statement audit is not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements and the supporting schedules. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements and the supporting schedules referred to above present fairly, in all material respects, the financial position and the results of operations of the Company for the period, for which the financial statements and supporting schedules were prepared, in accordance with accounting principles generally accepted in Japan. Other Matter Our firm and engagement partners have no interest in the Company which should be disclosed pursuant to the provisions of the Certified Public Accountants Law of Japan. Notes to the Reader of Independent Auditor’s Report:

The Independent Auditor’s Report herein is the English translation of the Independent Auditor’s

Report as required by the Company Law.

66

[English Translation of the Audit Report Originally Issued in the Japanese Language]

AUDIT REPORT

We, the Audit Committee of Konica Minolta, Inc. (“the Company”), have audited the performance of

duties by directors and executive officers during the 110th business year from April 1, 2013 to March 31,

2014. We report the method and results as follows.

1. Method and details of audit

We, the Audit Committee, have received reports from the executive officers and employees on a

regularly basis on the details of the board resolutions with respect to items prescribed in Article 416,

Paragraph 1, Item 1, b) and e) of the Company Law, and the status of the establishment and operation

of the system established based on such board resolutions (internal control system), sought

explanations, whenever the necessity arose, and expressed our opinions. Also, in accordance with the

audit standards, audit policy, audit plan, assignment of duties, etc. determined by the Audit Committee

and in cooperation with the internal audit division and other internal control divisions of the Company

and the auditors of subsidiaries, we verified the process and details of the decision-making at the

important meetings, etc., the details of the primary decision documents and other important documents,

etc. on the performance of business operations, the status of the performance of the duties of directors,

executive officers and others, and the status of business operations and assets of the Company.

With respect to subsidiaries, we confirmed the status of their business and management by

communicating and exchanging information with directors and corporate auditors of the subsidiaries,

visiting and attending important meetings, and inspecting important decision documents, etc.,

whenever the necessity arose.

Moreover, in addition to monitoring and examining whether the accounting auditor maintained an

independent position and performed auditing appropriately, we received reports from the accounting

auditor on the performance of its duties and requested explanations when necessary. In addition, we

received notice from the accounting auditor that “The systems for ensuring the proper performance of

duties” (set forth in each item of Article 131 of the Regulations of Corporate Financial Calculation)

are organized in accordance with the “Standards for Quality Control of Audit” (Business Accounting

Council, October 28, 2005) and other relevant standards, and sought explanations whenever necessity

arose.

Based on the above methods, we examined the business report, financial statements (balance sheet,

statement of income, statement of changes in shareholder’s equity, notes to financial statements),

supporting schedules, and the consolidated financial statements (consolidated balance sheet,

consolidated statement of income, consolidated statement of changes in shareholder’s equity, notes to

consolidated financial statements) for the fiscal year under review.

2. Results of audit

(1) Results of audit of business report, etc.

i) In our opinion, the Business Report and accompanying schedules fairly represent the

condition of the Company in accordance with the laws, regulations and Articles of

Incorporation of the Company.

ii) We have determined that there were no serious occurrences of dishonest or false activity or

violations of any laws, regulations or the Company’s Articles of Incorporation by any

directors or executive officers in carrying out their duties.

iii) We believe the details of resolutions of the Board of Directors regarding the internal control

system are appropriate. We found no matters of note with respect to the execution of duties

of executive officers regarding the internal control system.

(2) Results of audit of financial statements and accompanying schedules

In our opinion, the audit method and audit results received from the accounting auditor KPMG

AZSA LLC are appropriate.

(3) Results of audit of consolidated financial statements

In our opinion, the audit method and audit results received from the accounting auditor KPMG

AZSA LLC are appropriate.

67

May 9, 2014

Audit Committee of Konica Minolta, Inc.

Audit Committee Member Hirokazu Yoshikawa (Seal)

Audit Committee Member Shoji Kondo (Seal)

Audit Committee Member Takashi Enomoto (Seal)

Audit Committee Member Yasuo Matsumoto (Seal)

Audit Committee Member Akio Kitani (Seal)

Note: Mr. Hirokazu Yoshikawa, Mr. Shoji Kondo and Mr. Takashi Enomoto are outside directors as

provided for in Article 2, Item 15 and Article 400, Paragraph 3 of the Company Law.